Byzantine legislation: a disease abounded by the pandemic

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Victor Cabezas
Pérez Bustamante & Ponce, Quito
vcabezas@pbplaw.com

It is very interesting to ponder how an organism only identifiable through microscopes has been able to lock the world down. A  globalised, interdependent, immediate, technological and ultra-connected reality was hit by an invisible agent.

Among the many lessons of lockdown, the Ecuadorian legal system has learned a simple yet transcendental one: welfare and wealth are not created by decree.

In 1991, the Colombian Constitution was promulgated. This text adopted a guarantee tradition [emphasis author's own], which had been developed for centuries (since the United States Constitution of 1787, the Fundamental Law of Bonn and other European constitutions). At that time, Colombia was going through one of the most complex moments in its history: the rise of drug trafficking. The guerrillas and paramilitary groups created a generalised environment of political violence of such magnitude that it forced the country to formulate a new social contract. In the 1991 Constitution, the State was seen as an inexhaustible guarantor of rights. This was understandable because an intense period of violence in Colombia had generated human rights violations, which had been perpetrated or authorised by the State. These included forced disappearances, extrajudicial executions and displacement etc. Hence, it was logical and desirable to have the State assume special obligations as guarantor and be held responsible in matters of human rights.

However, in the Colombian model, the guarantor role of the State was also expanded into economic, social and cultural rights, such as labour and social security rights, health and education culture, among others. In other words, the role of guarantor of the State was placed on the same level as either the first-generation rights^[1] (integrity, life etc) or social and economic rights that mostly depended on public funding. 

In 1998 Ecuador promulgated a Constitution following an international trend that took strength with the promulgation of the Colombian Constitution. Ten years later, in October 2008, another constitutional text was promulgated. This text created a new paradigm in Ecuadorian legal history, leading to such a level of guarantee and state interventionism that it became almost paternalistic. The 2008 Constitution introduced the model of creating welfare by law. It transformed a legal text into a political promise that ensured prosperity, housing, work for all, unlimited resources for education and culture and, ultimately, a series of guarantees that deviated from orthodox and classical notions of the function of the public sector. Aside from whether these state objectives were desirable, efficient or useful, the truth is that in legal terms, the irradiating effect of this constitution on the legal system meant that the lower laws became infected with the notion that wealth could be created by decree that is, that the normative text was the genesis of wellbeing.

This constitutional tendency promoted the State, totally detached and separate from the economy or the private sector, in defining the conditions of welfare. In 2008, all forms of labour outsourcing were forbidden, since these were considered to be contrary to the dignity of workers. The hourly contract was also abolished because, from the State´s viewpoint, this work was discreditable. The tradition of imposing welfare through the legal system was therefore maintained. All forms of labour contracting that were not for an indefinite term were limited. Contracting with third parties was practically cancelled, termination benefits were radicalised and finally, in 2015, the fixed-term contract was eliminated.

The Ecuadorian economy was already feeling the effects of not being able to keep up with these avant-garde labour regulations when the Covid-19 pandemic arrived and the rigidity of the Labour Code made underemployment grow exponentially. 

The first Covid-19 case was reported in late February 2020. On 17 March 2020, the President declared a state of emergency and, since then, the country has lived in confinement. Commercial activities have been paralysed and production has been reduced by 70 per cent. Ecuador has begun to be ravaged by chimeric legislation that was never focused on the real economic circumstances of the country.

Welfare standards and the untouchable nature of labour rights have prohibited Ecuadorians from taking the measures that other countries in the region implemented to preserve employment. As the real economy is not created by decree, nor does wealth come in a code, international projections suggest Ecuador is among the countries that will lose the most jobs in the period 2020-2021, even though it has some of the most advanced labour standards. The country has been so shocked by the disconnect between its utopian ideals and reality that today it is racing to pass a law that, although a novelty in Ecuador, is undeniably logical: the parties can agree and modify the economic terms of the labour relationship to preserve the greater good, that is, employment. 

The pandemic has provided many lessons. In legal terms, it has shown the flaws of a pretentious system that tries, but fails, to create wellbeing as the norm. This is a chimerical order that, when faced with the implacable reality of our economic capacities, becomes futile and leaves us facing the worst of worlds: one with wonderful laws but overwhelming realities.

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