On May 14, 2025, Ecuador's Official Registry published the Seventh Supplement to No. 38, formally enacting the Organic Law Amending Various Laws on Age Discrimination in the Labor System. This legislative advance represents a significant milestone in promoting an egalitarian and inclusive labor market. Its primary objective is to directly address structural age discrimination, a long-standing issue that affects labor force participation and organizational diversity in the country. 

A regulatory response to a structural challenge 

For years, both young job seekers and older professionals have faced implicit barriers to accessing employment opportunities on equal terms. These have included age limits in job offers, biased promotion practices, and unequal access to professional development, which has limited labor mobility and underutilized available human resources. 

Objectives and strategic importance 

The new reform seeks to eliminate age as a discriminatory factor in employment-related decisions. Thus, institutions improve access and permanence in roles in both the public and private sectors. From the perspective of human resources management and regulatory compliance, these reforms require organizations to reevaluate their risk exposure, labor policies, and inclusion strategies to adapt to this new legal framework. 

Main legal reforms 

To achieve this greater labor equity, several key legal instruments have been modified to align with the law's anti-discrimination objectives. 

In the Labor Code, employers must now provide training focused on workplace inclusion and anti-discrimination practices. Furthermore, age discrimination in hiring processes is explicitly prohibited, as is the use of additional contractual requirements, such as insurance policies, as a condition for employment. An important new provision is that employers with 25 workers must hire at least one person over 40 years old. Additionally, companies with more than 25 workers must have at least 1% of their staff over 40 years old. Non-compliance will be subject to penalties, increasing the regulatory responsibility of affected entities. 

Apart from private employers, controls on public sector hiring have also been reformed through the Organic Law of the Public Sector (LOSEP). Age restrictions for entry and promotion in public service positions are eliminated. Similarly, continuous training in the prevention of discrimination and workplace harassment is reformed and promoted in all state institutions. 

Regarding the Organic Law of the National Public Procurement System, certified candidates registered in the national employment program will gain higher priority, reinforcing the government's commitment to equitable access to work within public procurement strategies. 

Finally, the Organic Law on Higher Education establishes that higher education institutions must promote the participation of people of all ages in academic programs, supporting continuous learning and skill development. Additionally, these institutions prohibit reducing working hours or modifying teaching staff functions based on retirement age, thereby protecting the labor rights and flexibility of older educators. 

Implications for financial and compliance teams 

For financial professionals, the implementation of this law introduces new compliance considerations related to workforce composition and labor reporting. Human resources, legal, and compliance teams will need to coordinate closely to ensure policies align with updated legal requirements. Furthermore, organizations may need to adjust internal controls, payroll systems, and performance metrics to reflect and support age-inclusive practices. 

In the long term, these reforms are expected to have a positive impact on workforce productivity, the retention of experienced talent, and organizational resilience, while reducing legal exposure to discrimination claims. 

If your multinational or fund seeks to ensure simplified payroll management and compliance with the new Ecuadorian labor regulations, our team of experts is at your disposal. We invite you to contact us via our form for a personalized consultation.

At Auxadi, we offer comprehensive services in accounting, tax, payroll, and corporate legal services to multinationals and funds. With experience since 1979 and a presence in over 50 countries, including 22 proprietary subsidiaries, our advanced technological platform and proven methodology enable us to guarantee efficient management in compliance with local regulations.