Ecuador Final Settlement Calculator
Ecuador · EmploymentEstimate your final settlement in Ecuador (private employee under the Labor Code): pending salary, prorated bonuses, vacation, reserve funds, the severance-notice bonus, and the unjustified-dismissal indemnity. The result changes based on the reason the contract ended.
Were you dismissed? The unjustified dismissal indemnity has its own calculator, with the breakdown by years and the cap. Unjustified dismissal indemnity →
How is it calculated?
The final settlement adds up what's pending when employment ends, and each item uses its own calculator. (1) Pending salary: salary ÷ 30 × unpaid days. (2) Prorated thirteenth-month bonus (only if accumulated): salary × days worked since December 1 ÷ 360. (3) Prorated fourteenth-month bonus (only if accumulated): 1 SBU (482 in 2026) ÷ 360 × days worked in your region's period (Coast and Insular from March 1; Highlands and Amazon from August 1). (4) Vacation: 15 days per year of service (plus 1 day per year beyond five, up to 30), prorated, minus days taken, at salary ÷ 30 per day. (5) Reserve funds: 8.33% of salary for each month since the first full year of service; only added if your employer hasn't paid or deposited them — those accumulated at the IESS are claimed from the IESS. (6) Severance-notice bonus: 25% of the last salary for each full year of service, when termination is by severance notice, unjustified dismissal, or mutual agreement. (7) Unjustified-dismissal indemnity (Art. 188): 3 compensations up to 3 years of service; from there, 1 per year (a fraction counts as a full year), capped at 25. A voluntary resignation without severance notice generates no bonus or indemnity. This is an estimate with a fixed salary: it doesn't include overtime, commissions, profit-sharing, or final-settlement-document agreements.
Examples
Resignation: salary of 900, hired 03/15/2022, departed 09/30/2026, monthly bonuses and funds
Only pending vacation remains: 38.17 days = 1,145. Estimated total: 1,145.
Unjustified dismissal with accumulated bonuses, unpaid funds, and 10 days of pending salary
Pending salary 300, thirteenth-month bonus 750, fourteenth-month bonus 80.33, vacation 1,145, reserve funds 3,188.72, severance-notice bonus 900, and indemnity 4,500: total 10,864.05.
What the final settlement includes by reason for termination
If you received bonuses and reserve funds monthly, you've already collected them month by month and they don't appear again.
| Item | Resignation | Severance notice (15-day notice) | Unjustified dismissal |
|---|---|---|---|
| Pending salary | Yes | Yes | Yes |
| Prorated bonuses (if accumulated) | Yes | Yes | Yes |
| Vacation not taken | Yes | Yes | Yes |
| Pending reserve funds | Yes | Yes | Yes |
| Severance-notice bonus (25% per year) | No | Yes | Yes |
| Unjustified-dismissal indemnity | No | No | Yes |
Final settlement example for a resignation
With a salary of 900, hired on March 15, 2022, departed on September 30, 2026, and monthly bonuses and funds, only pending vacation remains: 1,145 (38.17 days). Estimated total: 1,145. Figures are illustrative.
Each item has its own details in the thirteenth-month bonus, fourteenth-month bonus, vacation, and reserve funds calculators; the dismissal case is in the unjustified dismissal indemnity calculator. The final settlement is the calculation; the settlement document is where the payment is recorded.
Sources
- Ministry of Labor and Human Development (Ecuador) — Labor Code: thirteenth- and fourteenth-month bonuses, vacation, severance notice, unjustified dismissal, overtime, and profit sharing — in effect since January 2026 · reviewed on September 25, 2026
- Ministry of Labor and Human Development (Ecuador) — 2026 Unified Basic Salary: 482 (Ministerial Agreement MDT-2025-195, Official Register Supplement 187 of 12/18/2025) — in effect since January 2026 · reviewed on September 25, 2026
- IESS / Ministry of Labor (Ecuador) — Reserve funds: 8.33% of compensation starting in the second year of service (Labor Code, Art. 196) — in effect since January 2026 · reviewed on September 25, 2026
- National Court of Justice (Ecuador) — Resolution 02-2025: binding precedent on the base compensation for the unjustified dismissal indemnity (most favorable recent compensation) — in effect since January 2025 · reviewed on September 25, 2026