Hire in Colombia

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Last updated at July 27, 2022

Currency

Colombian Peso (COP)

Capital

Bogotá

Time Zone

GMT-5

Key Country Facts

Introduction

Colombia, officially called the Republic of Colombia, is a country in the northwest of the South American continent. With a population of just over 50 million people, it is a democratic republic with its elected president serving as both head of state and head of government. Colombia’s economy, the third largest in South America, is currently experiencing a period of fast growth.

Area

Colombia is bordered by Panama in the northwest, Venezuela and Brazil to the east and Peru and Ecuador to the south. It hosts a coastline to the north with the Caribbean Sea and to the west with the Pacific Ocean. Colombia has a total land mass of over 1.1 million square kilometers.

Climate

Due to the country’s close proximity to the equator, the climate is generally tropical and isothermal. There is no significant change of seasons in Colombia.

Culture

Geography has been an important factor as Colombia sits at the crossroads of Central and South America, bringing together Native American, Spanish influences and other European influences. Colombians are proud of their diverse culture, both traditional and modern elements.

Religion

Religious freedom is guaranteed by Colombia’s constitution. The vast majority of Colombians adhere to Christianity with over 70% identifying as Catholic. Evangelical Protestants account for the next largest group. Less than 10% claim no religious affiliation.

Official Language

More than 100 indigenous languages or dialects are spoken in Colombia. Castilian Spanish is the official language and is spoken by over 99% of the population.

Colombia HR at a Glance

Employment Law

Employment in Colombia is governed primarily by the Colombian Labor Code (CST) of 1950 and its subsequent modifications. It regulates the terms and conditions of employment, such as the form and duration of employment contracts, probationary periods, salaries, working hours, holiday time, termination of employment and collective bargaining.

Colombian labor rules and principles have a constitutional hierarchy. Employers cannot, even with the employee’s approval, provide conditions worse than those recognized by the law, the constitution or an international treaty or convention.

Employment Contract

Employment contracts are deemed as such if they observe the following three conditions:

  • services are provided by the person directly
  • there is subordination from the employee towards the employer
  • a payment as a retribution of the service is provided

Employment contracts can be either verbal or in writing. There are no statutory requirements for writing up a contract. However, Spanish is recommended as Colombian authorities will require any employment document to be in Spanish or translated into Spanish.

In Colombia, you have two ways of paying employees’ monthly wage. Each has its advantages and disadvantages, and you can determine which of the options is most suitable for each employee.

Ordinary salary

With an Ordinary salary, the ordinary wage is calculated and paid separately from statutory benefits contributions. On top of that, the employer must provide the employee with certain legally defined fringe benefits:

  • Severance Fund (Cesantias)
  • Severance Fund Interest (Interesses Cesantias)
  • Transportation expenses
  • Holiday/Vacation pay
  • 13th-month salary (prima de servicios)

Integral salary

The integral salary is where all statutory benefits and contributions are packaged into a fixed salary payment. This means that the integral salary includes fringe benefits and potential surcharges, such as overtime for evening hours, Sunday hours, public holiday hours, and extra-legal bonuses. In order for an employee to be eligible for an Integral salary, the employee must be paid at least the Integral monthly minimum wage or more, which in 2022 is COP 13,000,000 (10 monthly legal minimum salary + 30% surcharge). The minimum wage in Colombia in 2022 equals COP 1,000,000 (approx. USD 260).

70% of the integral salary represents the basis to calculate employee’s and employer’s contributions to the Colombian Social Security system. In some cases, the integral salary is a very attractive option, since it can help reduce an employee’s overall cost.

Fixed Term Contracts

Fixed-term contracts are required to be in writing in order to be deemed valid. The labor code establishes that the fixed-term contract length is free for the parties to determine. However, it cannot exceed three years. Additionally, there are no limitations on the possibility of successive fixed-term contracts or renewals.

However, when a fixed-term contract is agreed upon for an initial period of less than one year, the law establishes a limitation of three successive renewals of the initial contract. Following this, the period of the contract will be considered indefinite.

Under a fixed-term contract, the employer must notify the employee of termination 30 days before the end of the contract in order to avoid its automatic renewal on the same terms.

Probation Period / Trial Period

Employees hired under an indefinite employment agreement can be subject to a probationary period of up to two months.

Employees hired under a fixed-term employment agreement can be subject to a probationary period of up to one-fifth the time of the fixed term agreed upon. This may not exceed two months. When considering the existence of successive fixed-term contracts, the parties cannot agree to trial periods except for in the first contract.

Working Hours

Both the employer and the employee are free to agree to the working hours without exceeding the legal limit of hours per week. The ordinary working time cannot exceed eight hours per day and 48 hours per week. Employees are entitled to a mandatory rest day, typically on Sunday. However, the law allows for the parties to agree that the daily working time can be distributed between four and 10 hours per day, ensuring the maximum working week.

The daily working time must be distributed in at least two parts, with a mandatory rest period between them. This rest period is not considered part of the daily working time.

Overtime

An employee must not be required to work more than two hours of overtime in a day. In a given week, overtime cannot amount to more than 12 hours. Overtime during the day (6 a.m. to 9 p.m.) is paid at a rate of 25% on top of the ordinary hourly rate. Overtime for night work (9 p.m. to 6 a.m.) is paid at a rate of 75% on top of the ordinary hourly rate.

If employees work on a Sunday or during a public holiday, they are entitled to extra pay of 75% above normal rates.

Employees who perform functions of direction, trust or management are excluded from the above rules regarding the maximum workday and overtime.

Health and Safety in the Workplace

The employer is required to provide a safe workplace, incorporating the adequate elements and tools to prevent work accidents and professional diseases. Every employer or contracting party is required to implement the “Safety and Health at Work Management System” in order to ensure the enforcement of all health and safety at work legislation.

A health check is required before commencement of an employment contract, and annual health checks are mandatory.

Bonus

All employers are required to pay a bonus (called a “prima”). The total of this payment is equivalent to a month’s salary and the bonus is paid in two installments in June and December.

Termination

In Colombia, an employment contract can be terminated by either party at any moment with immediate effect. Grounds for termination in Colombian legislation can be divided into three categories: 

  • Legal grounds: Legal grounds include termination grounds unrelated to the employee’s behavior but rather to the operation of the law that requires the termination of the contract. For example, this covers the death of the employee, the expiration date of the term initially agreed in a fixed-term contract or specific conditions in employment contracts. In these cases, where the employment contract ends because of the operation of the law, the employee is not entitled to a severance payment. 
  • Termination with a fair cause: This normally refers to situations related to gross misconduct by the employee. These fair cause grounds are clearly defined by law and the parties must not add supplementary grounds as a reason for the contract to be terminated. However, the parties do have the possibility, through the contract or the company manual, to define situations that can be considered as serious misconduct. Employers should complete prior diligence with the worker before notifying a decision. In these cases, the employee is not entitled to a severance payment.
  • Termination without a fair cause: Termination without a cause includes all situations that are not considered as a legal cause or a fair cause. In these circumstances, the employee is entitled to a severance payment in accordance with the law. Termination without a cause can be limited as such termination may be deemed unfair. If so, the termination can be considered void. Typically, the consequence will be the reinstatement of the employee rather than recognition of a severance payment.

Restricted or prohibited terminations

There are special cases where employers may not terminate an employment agreement without getting authorization from the Ministry of Labor or a Labor Judge, even with just cause:

  • Employees who are pregnant or on maternity leave are protected from termination without authorization. This protection extends to a father or partner who is an employee when the mother is unemployed and included as her beneficiary with the social security authorities. 
  • Employees who are on sick leave or have restrictions that substantially inhibit their ability to comply with their duties are protected from termination without authorization. 
  • Employees who are less than three years away from retirement are protected from termination without authorization. 

Collective Dismissals

In order for an employer to proceed with a collective dismissal, it must first receive authorization from the Ministry of Labor.

Notice Period

No specific notification procedure is required in the case of dismissal with justified cause or without justified cause. However, the reasons for dismissal must be communicated to the employee by the termination date (as per Articles 62, 64 & 66 of the Labor Code). However, a prior 15-day notice is required in certain specific situations of dismissal, such as when the justified cause is related to an employee’s misconduct or poor performance.

Severance Pay

Unilateral termination without cause is allowed by law but it will prompt severance obligations.

  1. If the termination is unilateral and without cause, the employee will be entitled to receive an indemnification. This is provided in addition to the employee’s final wages. 
  2. For employees with an indefinite term agreement, such indemnification will be calculated as follows:
    • For employees earning less than 10 times the minimum legal monthly wages, the compensation is 30 days of salary for the first year of service and 20 days of salary for each additional year of service. This is calculated proportionally to the fraction of a year. 
    • For employees earning 10 times the minimum legal wages or more, the compensation is 20 days of salary for the first year of service and 15 days of salary for each additional year of service. This is calculated proportionally to the fraction of a year)
  1. For employees with a fixed-term agreement, the severance will be equal to the salary owed to the employee until the term of the agreement expires.
  2. For employees who entered into agreements for the duration of a project, the severance will be the estimated salary owed to the employee until the project concludes. However, in no case can severance be less than 15 days of salary.

Post-Termination Restraints / Restrictive Covenants

Post termination non-competes, customer non-solicits and employee non-solicits are not enforceable in Colombia. However, such provisions are typically drafted in employment agreements because they can have a deterrent effect or instill a sense of moral obligation on the part of the employee.

Trade Unions / Collective Agreements

The option for employers and employees to associate through trade unions and employers’ associations is guaranteed as a constitutional right in Colombia. Trade unions are prevalent in certain sectors, particularly industrial and public sectors. At least 25 workers are required in order to establish and maintain a trade union in Colombia. Effectively, when a company employs at least 25 employees, its employees can establish a company level union. Only the employees can form a union.

There are no work councils or other employee representatives in Colombia.

Tax and Social Security

Personal Income Tax

Taxable income (TVU*)

Over Not over Marginal rate (%) Tax liability
0 1,090 0 0
1,090 1,700 19 (Taxable income or taxable occasional gain translated into TVU less TVU 1,090) x 19%
1,700 4,100 28 (Taxable income or taxable occasional gain translated into TVU less TVU 1,700) x 28% + TVU 116
4,100 8,670 33 (Taxable income or taxable occasional gain translated into TVU less TVU 4,100) x 33% + TVU 788
8,670 18,970 35 (Taxable income translated into TVU less TVU 8,670) x 35% + TVU 2,296
18,970 31,000 37 (Taxable income translated into TVU less TVU 18,970) x 37% + TVU 5,901
31,000 And up 39 (Taxable income translated into TVU less TVU 31,000) x 39% + TVU 10,352

Tax reform incorporated the tax unit (Unidad de Valor Tributario or TVU) to measure the different limits and thresholds originally set in absolute numbers. This is adjusted every year by decree. The value of each tax unit is equivalent to COP 35,607 for 2020 fiscal year and COP 36,308 for 2021 fiscal year.

Social Security

Employees in Colombia must be enrolled in the social security system (for pension, health and labour risks) and employers have the obligation to make the corresponding monthly contributions on time.

The basis to calculate contributions to the social security system (pensions, solidarity pension fund, health and professional risks) is the ordinary monthly salary earned by the employee. However, if the monthly salary exceeds 25 times the minimum wage, contributions to the social security system will be calculated on the maximum basis of 25 times the minimum wage.

Type of insurance Paid by employer Paid by employee Total
Pension Plan 12.0% 4.0% 16.0%
Medical Plan 8.5% 4.0% 12.5%
Family Compensation Fund (Parafiscales) 4.0% 0.0% 4.0%
Welfare Institute (ICBF) 3.0% 0.0% 3.0%
National Training Service (Sena) 2.0% 0.0% 2.0%
Labor Risk (ARL) 0.522%** 0.0% 0.522%
  30.022% 8.0% 38.022%

*The above table serves as a broad guideline. Actual rates charged by GoGlobal will differ.

**The percentages are established according to risk classification of jobs, and is subject to change.

Employees

Salary Payment

Employers are required to pay their employees monthly by bank transfer. Salary should be paid on the last working day of the month. It must be paid in Colombian pesos, the local currency.

Payslip

Payslips should be delivered either via a protected email or through an employee self-services (ESS) platform. This must be in Spanish.

Annual Leave

The minimum holiday entitlement is 15 days each year. This accrues on a basis of 1.25 days per month from the commencement of employment. Employees are required to take at least six annual leave days each year.

Carry over rules

Upon agreement, holiday days may be accumulated for a period of two years. The employer and the employee can agree on a monetary compensation calculation for the vacation period. This must not not exceed 50% of the holiday.

Sick Leave

In the event of an employee’s sickness or an accident that causes a work incapacity, it is necessary to have the incapacity certified by a licensed practitioner or the competent authority. This is normally chosen by the employee. The certificate clearly establishes the days required for the employee to recover and return to work. The employer compensates sick leave during the employee’s absence. This can last for an indefinite period. However, from the third day of sick leave, the employer can claim the payment back through Colombia’s social security system.

In the case of illness or accident unrelated to work, the employee is entitled to receive 66.67% of their regular salary.

In the case of any work-related accident or illnesses, the remuneration is assumed by the social security system on a basis of 100% of the employee’s salary during the entirety of his incapacity to work.

Other Paid Leave

Employees are entitled to take paid leave in the following circumstances:

  • Marriage Leave: Employees are entitled to five days paid leave.
  • Trade Union Leave: Employees are entitled to paid leave to serve on a trade union committee. Employees also are entitled to leave for other trade union purposes if they give adequate notice to the employer and the absence does not adversely affect the business.
  • Voting Leave: Employees in Colombia are entitled to paid leave for the purposes of voting in public elections. This allows for half a day of paid leave. 
  • Personal Leave: Employees are entitled to take up to five days of paid leave to attend to serious personal matters.

Employees have the right to take unpaid leave for the following circumstances:

  • Military Service: The employment contract is deemed suspended if an employee is called to military service. The employer must allow the employee to resume the same position within 30 days of the completion of service.
  • Personal Reasons: The employment contract can be suspended for specific causes, as defined by law. One such cause is the parties suspending the employment contract on mutual consent. This specific situation is commonly used by employers to grant employees non-paid leave for personal reasons.

Compassionate & Bereavement Leave

Mourning Leave: An employee is entitled to five days’ paid leave for the death of a spouse or permanent partner, parent, child, sibling, grandparent, grandchild, mother or father-in-law, son or daughter-in-law, stepchild or stepparent.

Burial Leave: Employers are obliged to grant the necessary leave for an employee to assist with the burial of a co-worker.

Compassionate Leave: While Colombian labor law requires employers to provide employees with a paid compassionate leave, it does not define the scope or length. Employers are recommended to analyze compassionate leave on a case-by-case basis.

Maternity & Parental Leave

Maternity Leave

Paid maternity leave of 18 weeks is granted to every employed pregnant or adoptive mother in Colombia. At least one week of leave must be taken before the delivery, which is extendable to two weeks when medically necessary. Adoptive mothers, (and fathers in charge of the newborn in case of the sickness or the death of the mother) are also entitled to this maternity leave. An additional two weeks are added for multiple births.

The payment of maternity leave is entirely under the charge of the healthcare system.. When the mother returns to work, she can take two 30-minute breaks per day for nursing (or as rest breaks) with no reduction in pay until the child is six months old. This can be made longer with a doctor’s note. There must be a space adjacent to the workplace where she can carry out this activity.

Paternity leave

A father is entitled to eight working days of paid paternity leave when his spouse or significant other gives birth or when he adopts a child.

Adoption rights

The same rights afforded by paternity and maternity leave are applicable in cases of adoption. If the father is the only adopting parent, he will enjoy the same rights as a mother.

Public Holidays

Employees are entitled to be absent from work on the public holidays defined by the law. They are entitled to their regular remuneration on these days. While it is common for municipalities to create other public holidays related to local festivities, private employers are not bound to such holidays. If, under any circumstance, the employer requires an employee to work on a public holiday, such work must be remunerated as if the employee worked on a Sunday (or whatever their weekly rest day is).

Benefits to the Employee in Colombia

Statutory Benefits

Employers and employees make statutory contributions to the Colombian Social Security System, which covers employees against certain social risks. The Colombian system includes the subsystems of healthcare, pension, labor risks and family allowance. As the social security system is managed by different entities (including both private enterprises and public agencies), the employee has the right to choose the agency they want to affiliate with for healthcare and pension. 

The main provisions include:

  • Medical care
  • Monetary sickness benefit
  • Unemployment benefits
  • Old-age benefits
  • Occupational risk and injury benefits
  • Family benefits
  • Maternity benefits
  • Disability benefits
  • Survivor benefits.

Other Benefits

Typical supplementary benefits offered by employers in Colombia include:

  • Private Healthcare (despite the coverage of the healthcare subsystem, it is very common for employers to provide their employees with private healthcare as a benefit)
  • Transportation subsidy
  • Life insurance
  • Birthday holiday
  • Educational support

Visas and Foreign Workers

General Information

The minimum requirements for a company in Colombia for sponsoring an expatriate worker include:

  • The company must be incorporated in Colombia with an address in Colombia.
  • The employer must present proof in the form of bank statements showing average monthly revenue of at least 100 times the legal monthly minimum wage in Columbia for the six most recent months prior to the visa application. 
  • The sponsor must present income statements of the business from the previous year.
  • The company must demonstrate the activity carried out by the applicant is fundamental and of national interest. they must also show they could not find a Columbian worker adequately skilled to carry out the work.
  • The employer is responsible for ensuring social security payments during the expatriate’s stay in Colombia. 

Initially a foreigner can remain in Colombia as a tourist for a period not exceeding 180 days, as long as the corresponding procedures for the work visa are carried out. Foreigners are not allowed to engage in any paid activities with a Colombia tourist visa. 

The visa is a legal requirement for the foreign individual to perform remunerated activities in Colombia.

The employer must act in accordance with Resolution 6045 issued in 2017 by the Ministry of Foreign Affairs of Colombia, for determining the correct type of visa or permit required for their foreign workers.

  • Visa Type – M (Migrant visa): The “M” visa authorizes foreign workers to engage in permanent employment. This visa is issued for a duration of up to three years at a time and can be renewed.
  • Visa Type – V (Visitor visa): The “V” Technical Visitor Visa or Temporary Service Provider visa is valid usually for one to six months. This is intended for companies with specific projects, which require the support of foreign personnel to carry out technical tasks for a short period of time.
  • Visa Type – V Intercorporate Transfer: This is valid usually for six months to one year. It is intended for Expats that move from their company (headquarters) to a branch in Colombia. The salary is still paid abroad. The Colombia Visitor Visa is usually issued for a maximum of 90 days but can also be issued for up to two years in certain cases. The decision is up to the Consular or Immigration authorities handling the visa application.
  • Visa Type – R (Residency visa): After holding a Migrant Visa (type M) continuously for at least four years, the Colombia Resident (R) Visa is issued for five years at a time. This can be renewed.

The following documents are required when applying for a Colombia work visa:

  • Photocopy of a valid passport (copy of the first page showing biographical data as well as copy of the page showing latest stamp of entrance into Colombia as proof of legal entry and stay)
  • Photocopy of previously issued visa if applicable
  • Passport photo (digital visa photo with white background, no older than three months)
  • Original work contract
  • The company’s registration documents
  • Certificates of experience (at least three certificates of experience in the corresponding profession or occupation; all must be legalized, apostilled and translated);
  • A letter of motivation from the employer stating why the employer was offered to a foreigner over a Columbian
  • Degree title (must validated by the Ministry of Education)
  • Permission or license granted by the competent authority (when it is a regulated profession)
  • Certificate proving the suitability of the foreigner and relevance of the contract (issued by the employer)
  • Letter of academic support (showing the visa applicant has the necessary academic training which agrees with the position to be performed)
  • Bank statements from the last six months (as proof of financial resources)
  • Proof of accommodation and address in Colombia

All documents must be in Spanish, translated by a translator certified by the Colombian government. Visas in Colombia are issued at the Ministry of Foreign Affairs (Ministerio de Relaciones Exteriores) office in Bogotá. Alternatively, they can be applied for at the Colombian consulate in the employee’s home country. The most important prerequisite for starting the application process is for the work contract to be in place and signed by both the employee and employer.

Fees

The visa application process in Colombia involves the payment of two separate fees: 1) the visa processing fee and then 2) another fee if the visa application is successful.

If the employee enters Columbia with dependents and has been granted a work visa, the dependents also have the right to apply for work visas in Beneficiary Quality. It is worth noting this type of visa does not allow family members to work. Only the visa holder (who has the employment contract) can perform a professional job.

After arrival in Colombia

Within 15 days of receiving the visa, the employee must visit the local immigration authorities (Migración Colombia) to register their stay. For stays longer than three months, a Foreigners ID Card (Cedula de Extranjeria) will be issued upon registration.

Public Holidays in 2022

S.No Occasion Date
1. New Year’s Day January 1st
2. Epiphany Holiday January 10th
3. St Joseph’s Day March 21st
4. Maundy Thursday April 14th
5. Good Friday April 15th
6. Labour Day May 1st
7. Ascension Day Holiday May 30th
8. Corpus Christi Holiday June 20th
9. Sacred Heart Day June 27th
10. Feast of St Peter and St Paul July 4th
11. Independence Day July 20th
12. Battle of Boyacá Day August 7th
13. Assumption Day Holiday August 15th
14. Columbus Day Holiday October 17th
15. All Saints’ Day Holiday November 7th
16. Independence of Cartagena Holiday November 14th
17. Immaculate Conception December 8th
18. Christmas Day December 25th

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