Colombia Labor Law Guide for Hiring Employees and Contractors
This labor law guide for Colombia has important information for businesses looking to hire employees or contractors in the country. Colombia is a country in South America.
As of 2023, Colombia’s economy continues to expand robustly, boasting a GDP growth of approximately 4.3% year-over-year. Key sectors driving this growth include oil and mining, agriculture, manufacturing, and finance.
The country is also becoming a hub for technology and IT services, which are significantly contributing to its economic output. Colombia’s economic landscape provides diverse opportunities for businesses and talent alike.
The country’s currency is the Colombian Peso (COP).
Minimum Wage
COP $1,300,000 per month
Overtime Wage
125% of regular salary for the first 2 hours, and 150%
Meal Breaks
Minimum of 30 minutes during an 8-hour workday
Rest Breaks
15-minute break for every 4 hours worked
Working hours
8 hours a day, maximum 48 hours a week
Salary Payment Cycle
Monthly
Payroll Taxes
Approximately 30% of the salary
Paid Vacation
15 days per year
Overtime Hours
Any hour beyond 48 in a week
Night Shift Hours
135% of the regular salary
Holidays
18 days
No Work Days
Not specified
Hiring Laws in Colombia
When hiring in Colombia, businesses must register as a local entity.
Setting up a business entity may take between 1-6 weeks and can have associated costs ranging from COP $1,000,000 to COP $3,000,000 depending on the complexity.
Employers must sign written employment contracts with their employees that detail compensation, job specifics, work hours, and termination clauses.
Employment relationships and independent contractor agreements are treated separately under Colombian labor laws. Independent contractors are not entitled to the same rights and benefits as employees.
Minimum Wages in Colombia
Colombia enforces a national minimum wage law which is set at COP $1,300,000 per month as of 2024. This rate is not subject to local variances and applies uniformly across all sectors.
Accordion Content
There are no exceptions to the minimum wage rate except for certain internships or apprenticeships which may have lower remuneration.
Employers are required to pay additional wages for holidays worked.
Working Hours in Colombia
In Colombia, the standard working hours are set at 48 hours per week, typically spread across six days. Hours beyond this threshold are considered overtime, compensated at 125% of the regular hourly rate for the first two hours, and 150% thereafter.
Accordion Content
Night shifts (10 p.m. to 6 a.m.) are paid at a 135% rate.
The minimum age for employment is 15, with strict regulations against child labor.
Payroll and Taxes in Colombia
Employers must make several payroll deductions:
- Social Security: 8% (employee), 12% (employer)
- Pension Fund: 4% (employee), 12% (employer)
- Occupational Hazard Insurance: varies (employer)
- Family Welfare Fund: 4% (employer)
Accordion Content
| Income Level (COP) | Tax Rate |
|---|---|
| Up to 1,090,200 | 0% |
| 1,090,200 – 2,826,500 | 19% |
| 2,826,500 – 4,543,800 | 28% |
| 4,543,800 – 15,179,000 | 33% |
| 15,179,000 – 50,000,000 | 35% |
| Over 50,000,000 | 39% |
Statutory Leave Policies in Colombia
Employers in Colombia must provide various leaves:
- Paid Vacation: 15 days per year, eligible after one year of service
- Maternity Leave: 18 weeks, fully paid
- Paternity Leave: 2 weeks, fully paid
- Sick Leave: Up to 180 days, with varying amounts of pay based on duration and doctor certification
- Adoption Leave: Similar to maternity leave
Accordion Content
Following is the list of Holidays in Columbia:
| Holiday | Date |
|---|---|
| New Year’s Day | January 1 |
| Epiphany | January 6 |
| Saint Joseph’s Day | March 19 |
| Maundy Thursday | Varies |
| Good Friday | Varies |
| Labor Day | May 1 |
| Ascension Day | Varies |
| Corpus Christi | Varies |
| Sacred Heart Day | Varies |
| Feasts of Saints Peter and Paul | June 29 |
| Independence Day | July 20 |
| Battle of Boyacá | August 7 |
| Assumption of Mary | August 15 |
| Columbus Day | October 12 |
| All Saints Day | November 1 |
| Independence of Cartagena | November 11 |
| Immaculate Conception | December 8 |
| Christmas Day | December 25 |
Employee Benefits in Colombia
Employers must provide various benefits:
- Social Security (healthcare, pensions, occupational risk insurance)
- Retirement Benefits through pension funds
- Mandatory severance payments (Cesantías)
- Annual bonuses (Primas) equal to one month’s salary
- Transport allowance if salary is below two minimum wages
Employee Termination in Colombia
Colombia does not follow At-Will Employment laws. Employment termination must follow
Accordion Content
specific legal procedures:
- Notice Period: Generally 30 days
- Severance Pay: Varies by length of service
- Written notice stating the reason for termination
- Employees can challenge termination through labor courts
- Termination allowed for just cause, including gross misconduct, criminal activity, or constant underperformance.