Quevedo & Ponce - Noticias Legales
The special emergent contract was declared unconstitutional by the Constitutional Court
- March 11th, 2025
- Quevedo & Ponce
The Constitutional Court analyzed the constitutionality of article 19 of the Organic Law of Humanitarian Support, related to the emerging special contract; and, by ruling 49-20-IN/25, determined that it violates the principle of intangibility of labor rights by allowing the employer to unilaterally terminate the contract without compensation. For this reason, it declared said provision partially unconstitutional, nullifying the possibility of finalyzing the contract before the deadline without payment of compensation.
Despite this ruling, the emergent contract remains in effect with the following characteristics:
- It can be signed for a maximum of one year, renewable once.
- It is not exclusively linked to the pandemic but can be applied to any temporary situation that justifies the need to ensure business sustainability.
- If the employer terminates the contract unilaterally before its term, compensation for unfair dismissal will be required.
- The contract becomes indefinite if the employment relationship continues after the term ends.
The Court also reminded the National Assembly to evaluate the Humanitarian Support Law and modify it if necessary, to ensure it meets its objectives. Additionally, it emphasized that the Ministry of Labor must oversee the proper use of the emergent contract to prevent violation.
At Quevedo & Ponce, we are experts in labor and constitutional law, providing effective consultancy on matters such as emergent contracts. Contact us to protect your rights and ensure successful legal solutions.
Más Artículos
The Constitutional Court provisionally suspended articles from three recently approved laws
On August 4, the Constitutional Court announced the decisions adopted by the Admissions Chamber. Among them was the provisional suspension of a transitory provision of the Organic Law on Public Integrity, several articles and the regulations of the Organic Law on Intelligence, and certain articles of the Organic Law on National Solidarity.
New Rules for the Annulment of Electronic Tax Documents in Ecuador: Tax Implications for Taxpayers
Discover the key changes introduced by Resolution NAC-DGERCGC25-00000014 issued by the Ecuadorian Internal Revenue Service (SRI), effective as of August 1, 2025, which regulate the annulment of electronic tax documents in Ecuador. This analysis addresses the tax implications and legal challenges for companies operating under electronic invoicing schemes.
Intellectual Property, International Harmonization, and the Role of Customs: The Philco Case as a Warning for Export-Oriented Companies
The use of trademarks in cross-border manufacturing operations poses significant legal risks, as evidenced by the Philco case in Brazil. This article analyzes how the unauthorized use of a trademark during manufacturing — even when the products are intended for export — may activate judicial and customs actions. Focusing the impact of the territoriality principle and the need for an international legal strategy.
New Regulation on Communal and Savings Funds Strengthens Local Financing and Financial Inclusion
The Financial Policy and Regulation Board of Ecuador issued Resolution No. JPRF-F-2025-0154, which reforms the legal framework for community savings and loan funds. The regulation seeks to strengthen local financing and financial inclusion, particularly in rural and urban-marginal areas. Among its provisions, it requires that these funds are established as legal entities, obtaining authorization from the Superintendency of Popular and Solidarity Economy (SEPS), and operate exclusively among individuals with common purposes. In addition, it sets asset limits, imposes restrictions on advertising and branch offices, and establishes transparency and corporate governance obligations.
Asset Regulation for Travelers under the Organic Law for the Prevention, Detection, and Eradication of Money Laundering and Crime Financing.
Starting July 29th, the National Customs Service of Ecuador (SENAE) is implementing a new mandatory requirement for travelers: the online declaration of values exceeding USD 10,000, in compliance with the Organic Law for the Prevention, Detection, and Eradication of Money Laundering and Crime Financing. This regulation aims to reinforce transparency and combat illicit activities in capital movements.
