Almost 13 years ago, this additional remuneration was created with the aim of ensuring that employees cover the basic basket.
In 2009, through the Organic Code of Production, Trade and Investment, the Government of Rafael Correa created the so-called living wage. East entry is a compensation that must be paid to their workers, until March 31 of each year, by all companies that have had profits.
Specifically, the concept behind this is to ensure that all employees have income that allow them to cover the Basic Family Basket (CDB)which is calculated by the National Institute of Statistics and Censuses (INEC).
Thus, it is assumed that, if salaries, tenth payments and other benefits are added and divided by 12, a minimum monthly income established every year by the Ministry of Labor must be reached. If that minimum level is not met, profit-making companies must pay them a additional remuneration or living wage to their collaborators as compensation.
The Ministry of Labor set that living wage at $447.41 per month for 2022, through the Ministerial agreement MDT 2022-0041. That value is the same as that calculated for last year.
Additionally, the ministerial agreement indicates what items are taken into account to calculate the monthly income. Among them are the monthly salary; the tenths; variable commissions paid by the employer; the participation of profits to workers or former workers of the fiscal year 2020 and paid in the year 2021; other benefits received in money by the worker for collective contracts and the reserve funds corresponding to the year 2021.
It is also provided that for the payment the employer must allocate 100% of the profits.
Since its validity, the living wage has had minimal impact and its payment reaches a small percentage. The same happens with the Unified Basic Salary (SBU), which since 2022 is $425, but less than 10% of formal workers in the country receive it. (JS)
