In Colombia, there is no significant distinction between white-collar and blue-collar workers as they share the same individual, collective rights and labour benefits set forth in the Labour Code (Código Sustantivo del Trabajo – CST) for workers in Colombia. However, for those workers in positions of leadership, who undertake trust and management tasks, there is a special regulation, according to which, such workers have no limitation on the maximum legal workday (47 hours per week). In addition, according to the law, workers who hold management positions in a company may not simultaneously hold management positions in a trade union.

It is important to highlight that in Colombia, labour and employment regulations for workers in the private sector are different from those established for public workers.

Different Types of Employment Contracts (Indefinite/Definite)

A relationship is considered to be an employment contract if three conditions are met:

• the person provides services directly;
• the person is subordinate; and
• compensation or payment is provided for the service.

If these three conditions are met, the relationship will be considered as an employment contract, disregarding the name or agreement the parties signed, since in Colombia, in labour matters, reality prevails over formal agreement.

Employment contracts can be verbal or written. Fixed-term contracts must be agreed in writing, otherwise, if there is no written agreement, the legal presumption that the contract is for an indefinite term will apply. In the case of verbal contracts, the law requires as a minimum that the nature of the work and the place where it will be executed must be agreed upon.

In accordance with current labour laws, employment contracts in Colombia can be classified according to their type or duration as follows:

• indefinite-term contract;
• fixed-term contract – these can be agreed for terms shorter than one year (with strict regulation of their extensions, which cannot exceed three in less than one year) and may be no longer than three years; and
• an employment contract for specific work or activity, which is effective during the term of execution of the work or activity (previously agreed by the parties).

Temporary workers

It is worth clarifying that it is feasible in Colombia to use a temporary supply of personnel through temporary service agencies (Empresas de Servicios Temporales – EST) for occasional work, to cover absences of leave or vacation of permanent staff, or to increase production; however, such contracts cannot exceed one year.

Written agreements

In Colombia, although employment contracts can be written or verbal, certain agreements must be in writing, such as:

• the fixed term of the employment contract;
• the fully integrated salary agreement;
• agreements regarding non-salary payments;
• the probation period of the employment contract; and
• the teleworking agreement of the employment contract.

Required terms

In the case of written contracts, the law provides a number of requirements that must be included, such as:

• identification of the parties’ domicile;
• the place and date of the agreement;
• the place of hiring and place where the worker will provide their services;
• the nature of the work;
• the amount of remuneration, form and periods of payment;
• where accommodation and/or food is provided as part of the payment, it is necessary to quantify the same; and
• the terms of the contract.

Regarding the regulation in Colombia of this matter, it is important to highlight that several bills are currently being discussed in Congress, one of them a labour law and regulation that will modify the conditions of fixed-term contracts, the forms of termination of employment contracts, the collective bargaining process, and outsourcing, among others.

Maximum Working Hours Per Day/Week

For more than 50 years, the maximum working hours in Colombia were set as eight hours per day and 48 hours per week, updated under the issuance of Law 2101 of 2021 which reduced the maximum legal working day as follows:

• as of 15/07/2023 – 47 hours as maximum working hours per week;
• as of 15/07/2024 – 46 hours as maximum working hours per week;
• as of 15/07/2025 – 44 hours as maximum working hours per week; and
• as of 15/07/2026 – 42 hours as maximum working hours per week.

The workers are entitled to a mandatory rest day, normally on Sunday, and the law allows the parties to agree that the daily working time can be distributed between four and ten hours per day to ensure the maximum working hours per week. Colombian labour law also provides different ways in which to distribute the maximum working hours, in accordance with ILO conventions ratified by the country.

Flexible Arrangements

In Colombia it is possible to have flexible arrangements for working time as follows:

• Special workday comprising six hours a day/36 hours a week – work without interruption, six hours a day and up to 36 a week; this workday does not accrue night or Sunday surcharges and it is subject to at least the legal minimum monthly wage in Colombia for the maximum legal workday.
• Work by shifts – there are two special work distribution options called “work by shifts” and “work without interruption”, in this arrangement the workday is extended to more than eight hours per day and exceeds the maximum weekly work schedule, as long as the average working hours calculated for a period of three weeks do not exceed eight hours per day.
• Flexible workday – four to ten hours a day up to 47 hours a week (under this workday mode, workers may distribute the hours between shifts ranging from four to ten hours per day).

Specific terms required for part-time contracts

It is feasible to agree on part-time employment contracts, provided that at least the legal minimum wage is paid pro rata to the number of hours worked, and contributions to the social security system must be paid on a minimum contribution basis equal to the monthly legal minimum wage in force.

Overtime Regulations

In Colombia, employers must have authorisation from the Ministry of Labour to work overtime beyond the mandatory work schedule. Failure to get authorisation will incur penalties. With regard to overtime, the law provides that workers cannot work more than two extra hours per day and 12 extra hours per week.

Workers should be compensated for overtime by their employers as follows:

• surcharge for overtime – 125%, accrued when the legal maximum workday is exceeded;
• surcharge for night work – 35% on top of the amount of the ordinary wage, accrued for work between 9pm and 6am;
• surcharge for extra night work – 175%, accrued when the legal maximum workday is exceeded between 9pm and 6am;
• surcharge for Sunday work – 75% surcharge on the value of the ordinary salary and in the case of regular Sunday work, a compensatory rest day; in the case of an occasional Sunday, the worker may choose an additional surcharge instead of the compensatory rest day.

It is important to highlight that workers in management positions, trust and leadership positions do not have a maximum legal working time limitation and therefore, they are not entitled to surcharges for overtime work. In addition, integrated salaries are not subject to any surcharge whatsoever (see 1.4 Compensation).

Regarding the regulations in Colombia on this matter, it is important to highlight that several bills are currently in progress in Congress, one of which is related to labour law and regulation. It will modify the conditions of fixed-term contracts, forms of termination of employment contracts, surcharges, collective bargaining processes, and outsourcing, among others.

Minimum Wage Requirements

The legal minimum wage for workers who work the maximum legal working hours in 2023, is COP1,160,000 per month with a mandatory transport allowance of COP140,606, and this can be paid proportionally where the worker works less than the mandatory workday or has a part-time job.

There are two kinds of salary:

• ordinary salary, whereby workers have the right to fringe benefits corresponding to two additional salaries per year equivalent to severance pay and legal bonus for services; and
• integrated salary, which must be agreed in writing, and should consist of at least a wage equal to ten times the legal monthly minimum wage, plus 30% (when this type of salary is agreed there is no right to severance pay, surcharges, or a legal bonus for services – only payment for vacations).

Likewise, the salary can be agreed as a fixed sum or as variable amount, always respecting the minimum income to which a worker in Colombia is entitled.

The salary can also be agreed in any legal currency, although the worker is entitled to ask for payment in Colombian peso (COP).

Other Requirements

In the case of ordinary salaries, employers must recognise:

• a legal bonus for services in June, equivalent to 15 days of salary (known as prima in Spanish);
• a legal bonus for services in December, equivalent to 15 days of salary (prima);
• severance pay corresponding to 30 days of salary, to be deposited in the Fund account by February each year;
• interest on the severance payment corresponding to 12% per year on the value of the severance pay; and
• vacation pay consisting of 15 days of salary per year.

In the case of an integrated salary agreement, the employer only pays for vacations (15 days of salary per year).

Government Regulations

Colombian labour laws regulate, on a mandatory basis, the salary increase that must be made to the legal minimum wage and the adjustment is established through negotiation in the Permanent Commission of Agreement of salary and labour policies. If no agreement is reached, the Colombian national government will fix the increase to the applicable minimum wage in January each year.

Regarding salaries above the current monthly legal minimum salary, there is no regulation ordering employers to adjust salaries by a certain percentage or at specified intervals. Without prejudice to the non-existence of an obligation to increase salaries above the legal minimum wage annually, it is important to highlight that the workers’ right to have wage mobility has been protected by a court ruling, and employers must therefore have policies in place regarding mobility and increases in workers’ salaries.

Vacation and Vacation Pay

In Colombia, workers have the right to enjoy 15 business days of paid rest (vacation) for each year of service rendered in favour of their employer. The date of vacation must be set by the employer, who must ensure that at least six days of continuous vacation per year are enjoyed.

In the case of retirement where the employee has not taken all their vacation, the employer must pay the value of the untaken vacation in cash.

Mandatory Holidays

There are 18 mandatory holidays per year that workers have the right to enjoy and for which they are entitled to receive compensation. If, under any circumstance, the employer requires an employee to work on a holiday, such work must be paid with surcharges.

Other Leave

• Paid sick leave: The social security system in Colombia covers the risks of disability or sickness, old age and death, and it is the employer’s and worker’s obligation to contribute monthly through a deduction made by the employer and the worker. The covered benefits include being paid a percentage of salary when too ill to work (Ingreso Base de Cotización – IBC). This is covered by the social security system.
• Paid maternity leave: This corresponds to 18 weeks, with the addition of more weeks in the case of premature or multiple births. In the case of abortion, four weeks’ leave is allowed. This is covered by the social security system.
• Paid paternity leave: This lasts for two weeks. It is also covered by the social security system.

Confidentiality and Non-disparagement Requirements

In Colombia, from the signing of their employment contracts, workers are bound to keep due confidentiality as provided by the law (Article 58, paragraph 2 of the Labour Code). This includes the workers’ obligation not to disclose any information about their job to third parties, especially anything classified as proprietary, or to disclose anything which may cause damage to the employer. Additionally, in Colombia, it is feasible to enter into specific civil agreements with workers regarding confidentiality obligations.

It is recommended that the worker should be made aware of which documents and/or procedures the employer considers confidential, so that the worker is in no doubt as to which information they must keep confidential.

Employee Liability

Pursuant to Colombian labour laws, there is protection for workers’ minimal rights, and for this reason their liability is limited and without prejudice to possible civil actions that an employer may raise. Article 28 of the Labour Code expressly states that a worker never bears risks or losses. However, a serious breach on the part of a worker can result in disciplinary sanctions under the employment contract, such as suspension, a fine, or even termination of the employment contract with fair cause.

The provision whereby a former worker is obliged to abstain from a certain activity or providing services to competitors of their employer once their employment contract is terminated, does not exist in Colombian labour legislation, as determined by Article 44 of the Labour Code.

Although workers may be obliged to provide services exclusively during the execution of the employment contract, once the employment contract is terminated, the agreement cannot prevent workers from providing services to competitors or taking part in a specific activity, as this would violate their right to work.

Pursuant to the explanation above, non-compete clauses in labour matters are not valid in Colombia and cannot be enforced before the labour courts once the employment contract is terminated. Although the parties may agree to secrecy and confidentiality, and no client or employee solicitation, the worker’s right to work takes precedence. The applicability of these clauses between companies must address criteria of proportionality and reasonableness to avoid a possible violation of the right to work.

Although it is not possible to enforce non-compete clauses after the employment contract has ended, it is feasible for employers and workers to enter into non-solicitation agreements on clients, employees, and suppliers. Contravention of these agreements involves civil proceedings in which the former employer must prove the breach.

These agreements entail the recognition of money amounts and penalty clauses in case of a breach.

There is a regulation in Colombia on the handling of personal data, which specifically regulates the management of information received by an employer from its workers, in furtherance of Article 15 of the Colombian Constitution, providing the fundamental right to privacy, good name, and expressly indicating the right to update and rectify information collected in databases, reiterating the respect for freedom and other guarantees in the collection, processing and circulation of data.

Law 1581 of 2012 establishes the rules on the management of personal data. Employers must take special care in the handling of personal information received from their workers, in order to comply with the aforementioned regulation and avoid violating the right to privacy and the development of the character of workers. Having said that, the personal information of workers, including their name; marital status; education achieved; identity document number; affiliation to organisations of various kinds, such as unions, human rights or political organisations; and other data that might reveal such individual’s racial or ethnic origin, political orientation, religious or philosophical convictions, as well as those related to health, sexual life, fingerprints, and biometric data, among others, related to privacy and personality, are classified as “sensitive data”. The management and treatment of this data require the express authorisation of the owner of the information, including the worker. It is worth noting that in Colombia there is also an obligation for workers and those affiliated to the social security system to provide accurate personal information to the system.

Regarding the working tools, the employer can monitor and access the worker’s electronic communications or any other applications, as long as they are related to the worker’s position or their electronic mail, and/or application is provided by the employer as a working tool. Case law understands that while social media is part of the employee’s intimacy circle, and therefore cannot be monitored by the employer, some actions performed on social media can cause harm to the employer. The use of social media to disparage the employer or to divulge confidential information about the company may cause damage to the employer’s public image and interests, which then allows the employer to initiate disciplinary measures.

In any case, the divulgence of confidential information by workers is considered to be expressly prohibited under Colombian labour law and can eventually lead to the possible termination of the employment contract by the employer, alleging a fair cause.

In order to introduce incentives in the formalisation and generation of employment, the Colombian Congress issued Law 1429 of 2010, which, in Article 65, modified Articles 74 and 75 of the Labour Code. As a result, a limitation or quotas for hiring foreign workers currently do not exist in the law.

It is important to note that there are currently special regimes in which certain proportions remain for the hiring of foreigner workers. These include oil companies and aviation companies (Articles 1803 and 1804 of the Code of Commerce).

The employer must bear the expenses for returning such foreign worker hired abroad to provide services in Colombia to their country of origin. In cases of residence for certain periods in Colombia, the worker must apply for a foreigner identification card.

The employer must report the hiring and letting go of a foreign worker to Colombia Migration (Migración Colombia) on the SIRE (Sistema Integrado de Registro de Extranjeros) platform within 15 calendar days following the initiation and termination of the employment relationship, under penalty of fines.

In some regulated professions, besides a work visa, foreign workers require special temporary permit registration. In the case of a regulated profession, the person’s competence must be reviewed, and an application must be made to the professional councils.

With regard to hiring foreigners to work in Colombia, the Colombian legal system requires the foreigner to hold a visa enabling them to work in Colombian territory, and in the case of regulated activities, to have a homologated registration in Colombia, as well as the respective temporary professional permit if the work relationship is up to two years, or the validation of the professional title before the Ministry of Education and an application for permanent professional registration, if the assignment in Colombia will be longer than two years.

Once the individual is hired with full compliance with the immigration requirements, it is the employer’s obligation to report on the virtual government platforms, SIRE and RUTEC, about the start and/or termination of employment of foreign workers:

• SIRE is the general registration platform for all foreign persons in Colombia – registration must be complete within 15 calendar days after the date of starting work; and
• RUTEC is supervised by the Ministry of Labour and its main function is to verify that employers comply with their obligation to make sure foreign workers are registered and affiliated to the Social Security System – this registration must be complete within 120 days after the date of starting work.

Failure to register on either platform will incur a fine from the relevant government entity.

In Colombia, since 2008, there has been a regulation for teleworking as a formal mode of remote work in which the employer and the worker can agree on one of three remote working modalities.

• Autonomous work: always outside the company and only going to the employer’s offices occasionally.
• Mobile work: in this modality, there is no established place for the provision of services and the use of technological tools is essential.
• Supplementary work: the employee works three days per week at home and the other days at the employer’s office. This agreement must be in writing, it must fix the days and places where the service will be provided, and an amount must be provided by the employer to cover equipment, connections, programs, energy, and travel expenses.

As a result of the COVID-19 pandemic, new laws were issued in Colombia that regulated other more flexible forms of remote work, such as special work at home, remote work (Law 2121 of 2021), and regulations for digital nomads. Likewise, it is common in Colombia to use home office benefits as part of worker retention strategies.

The law expressly determines the cases in which the employer must grant compulsory and paid leave to the worker, directly assuming its cost.

• Leave for lactation that corresponds to one hour of daily leave for the baby’s first six months and half-an-hour daily until the baby is two years old, if the mother proves that she is still breastfeeding the child.
• To vote, by granting permission to vote and by providing breaks to encourage exercise of the voting right or for being part of a voting jury, which corresponds to half a day and one day of paid leave, respectively.
• To attend union activities, reasonable permits for the affiliated members must be granted, and union activities must not seriously affect the normal operation of the company.
• Permission to attend the funeral of co-workers.
• Permission for serious domestic calamities.
• Leave of mourning for the death of a close family member (second degree of consanguinity and first of affinity) corresponding to five business days of paid leave.

Taking into account that in Colombia there are several forms of remote work as indicated in 5.1 Mobile Work, the possibility of shared workplaces, and flexible work without a specific place are currently being used by employers, and hybrid work (home and office) is a common measure to retain workers.

Law 2069 of 2020 brought the “digital nomads” concept to the country and mandated the government. This concept includes teleworkers, distance workers, or remote workers, regardless of the type of contract executed for that purpose.

The possibility for employers and workers to associate through trade unions and employers’ associations is guaranteed as a constitutional right.

Union organisations in Colombia can be composed of workers or employers.

Workers’ organisations can be:

• first degree, integrating at least 25 workers;
• second degree or federations that gather unions; and
• third degree or confederations – associations of federations that can also directly affiliate unions.

A union of first-degree workers requires at least 25 affiliated workers to form the union, and its legal status is recognised once the incorporation certificate is filed and recorded before the Ministry of Labour, together with the by-laws and the list of workers who are part of the board of directors. The Ministry of Labour serves as the registry and recipient of applications for the creation of union organisations.

Workers can affiliate with multiple trade unions, even within the same company. The collective bargaining process must be undertaken with every trade union within the organisation, disregarding their number of affiliates.

Union organisations are protected under the right of association from the time of the meeting, although they can only act as a legal entity once registered in the Registry of the Ministry of Labour. One of the main functions of union organisations in Colombia is to represent workers during the collective bargaining process, a regulated procedure through which union organisations seek economic and union recognition to improve the working conditions of their members. In Colombia, there are no specific rules regarding representation for trade unions. Therefore, every trade union enjoys the same rights for collective bargaining, no matter the number of affiliates.

There are several kinds of first-degree union organisations:

• company union organisations (where workers of the same company are affiliated);
• industry union organisations (which represent and affiliate workers from all companies belonging to the same industry);
• union organisations from the same guild (representing workers from the same guild or trade); and
• union organisations from various trades (which allow the association of different trades, in the event that it is not viable to have 25 workers in a single trade).

Union organisations have internal rules that require the creation of a general assembly composed of members and the formation of a board of directors, and they are allowed to have regional offices in municipalities of the country.

Direct Settlements

One of a union’s main functions is the exercise of collective bargaining power, under which a list of demands can be submitted to its company, which then has 24 hours and a maximum of five days to start the direct settlement and discussions with the union.

The direct settlement process has a duration of 20 calendar days extendable for 20 additional calendar days by mutual agreement, within which the parties must reach agreement. If there is no or partial agreement, the points on which no agreement was reached will keep the conflict open and the union organisations are entitled to call a vote within the company to determine if the conflict can be resolved by an arbitral tribunal or if the union should make use of the peaceful cessation of activities, known as a strike.

Strikes

The voting of a strike as a pressure mechanism within the negotiation process has clear rules on democratic majorities and depends on the quality of the majority union (50% plus one) or minority union (50% or less) of the direct workers of the company that are affiliated to the union. In any case, if a strike is voted by a simple majority, it cannot last more than 60 days, and during this time all activities of the company will cease and no workers’ wages will be paid.

If the workers vote for an arbitral tribunal or once a strike has begun, the dispute must be resolved by an arbitral tribunal, which will resolve each of the points on the list of demands in equity, not in law.

There is currently no limitation on the number of unions a worker may belong to, and any union can start a collective bargaining process by submitting a list of demands. This situation has led to an exponential increase in the number of union organisations in Colombia, while the percentage of affiliated workers has not varied substantially.

The right to strike is recognised as a constitutional right and the exercise of this right must be in accordance with democratic principles. In general, strikes can come as a result of three situations:

• a failed collective bargaining process, where its definition and practice are regulated by law;
• a breach of legal and/or conventional rights by the employer (in this case, the exercise of the right to strike does not require a previous collective bargaining process); and
• a strike by solidarity where a trade union supports the strike of another trade union, because of economic and/or political reasons.

Limitations on the right to strike apply to essential public services, as defined by law (ie, the public utilities sector).

The most recent union-related census conducted by the Colombian Ministry of Labour shows that the percentage of unionisation in the country is around 6.4% of the working population.

The result of this negotiation between a trade union and an employer is a collective bargaining agreement (CBA).

Special Protection

Trade union members may enjoy special protection in specific cases (ie, during the collective bargaining process) and may have special permits for union purposes. This is important, because Colombia’s labour law does not provide any law regarding workers’ participation in employers’ decisions.

Within the representative bodies of elected workers there are some committees at the companies in which workers from those companies participate, such as:

• The COPASTT or Comité Paritario de Seguridad y Salud en el Trabajo (Occupational Safety and Health Committee created by the 1295 Decree of 1994) is in charge of the promotion and surveillance of the rules on occupational health and safety issues; as it is a parity committee, it is made up of an equal number of representatives of the employer (workers appointed by the employer at its discretion) and workers elected by open voting by the company’s workers for a period of two years.
• Labour Co-existence Committee (Against Harassment at the Workplace) created under Law 1010 of 2006, which receives complaints on workplace harassment within the company, and internally and confidentially seeks to overcome situations. Half of its members represent the employer and are appointed by the same, and the other half are elected by a vote within the organisations in which workers from those companies participate, such as, the COPASTT.

Collective bargaining agreements (CBAs) in Colombia can be collective agreements signed with union organisations or collective covenants (collective agreements signed with associated but non-unionised workers).

CBAs, both collective agreements and collective covenants, have a vocation for permanence, that is, they are extended for six months, if they are not reported or if there is no collective bargaining.

In Colombia, CBAs are signed by companies and union organisations (business, industry, guild or various trades) or non-unionised workers. There is no framework negotiation, which means that each company is responsible for the agreements it signs.

Signed collective labour agreements (CLAs) must be filed with the Ministry of Labour within 15 days after the signing date. The Ministry houses a unit called the union archive containing all CLAs signed in the country.

Collective bargaining takes place in stages, as follows:

• filing of the workers’ express will with regard to the existing CLA or presentation of a list of demands;
• the direct settlement stage which either results in:
1. a collective labour agreement, which results in a strike and a CBA, then an arbitral award; or
2. no agreement, which leads to arbitration and the issue of an arbitral award; and
• the possibility for an appeal.

In Colombia, employment contracts may be terminated by any of the parties at any moment with immediate effect (a period of notice is only needed for fixed-term contracts).

The grounds for termination by an employer in an employment contract can be divided into the following:

• Legal grounds – causes relayed in Article 61 of the Labour Code refer to extinction due to objective causes such as the death of the worker or expiry of the agreed term, among others.
• Termination without a fair cause – only in the termination of an employment contract considered as without a cause, is the employee entitled to a severance payment in accordance with the law. The termination without a cause does not require a period of notice but finds limitations for its use in situations that might be considered arbitrary or that infringe upon a superior hierarchical right normally related to employees under special protection (ie, union representatives, pregnant employees, employees who are disabled, etc).
• Termination with a fair cause – this normally refers to situations related to gross misconduct by the employee or the recognition of a disability allowance or old age pension. These fair cause grounds are defined explicitly by law and the parties cannot add supplementary grounds as a basis for the contract to be terminated.

Within the forms of termination of the employment contract, the termination of the contract by unilateral decision of the employer with fair cause, or dismissal with fair cause, is regulated by Article 62 of the Colombian Labour Code and before ending a work contract with fair cause, it is necessary to carry out an internal disciplinary process to guarantee due process to the worker, that is, to become aware of the evidence against the worker and to challenge the same. The most relevant reasons that may be alleged by the employer to terminate the employment contract include:

• serious deception about the worker’s certificates and information used to be admitted to work;
• violence, mistreatment or serious indiscipline;
• intentional material damage to the property of the company and serious negligence;
• serious breach of the express or known obligations and prohibitions of the company contained in the employment contract, CLA or internal work regulations;
• detention for more than 30 days, provided that a conviction is ratified; and/or
• recognition of old-age pension or invalidity by the system, among others.

Any disciplinary procedure should be developed by respecting due process, the right of contradiction, and fundamental rights.

Amount of Severance

The amount of the severance payment differs according to several factors such as seniority, type of contract, and the amount of salary:

• For workers hired before 1 January 1981, the system applicable is the 2351 Presidential Decree of 1965 – these workers have a special stability regime which excludes the possibility of termination without cause. However, in exceptional cases where this termination is applicable, the severance payment corresponds to 45 days of salary for the first year of service and 30 days of salary for each subsequent year of service or pro rata.
• For workers hired before 28 December 1992, the system applicable is the 50 Act of 1990 – in this regime, severance payments correspond to 45 days of salary for the first year of service and 40 days for each subsequent year of service or pro rata.
• For workers hired after 28 December 1992 the system applicable is the 789 Act of 2002 – in this regime, the severance payment formula depends on the compensation. For workers who earn less than ten times the minimum wage, the severance payment corresponds to 30 days of salary for the first year of service and 20 days for each subsequent year of service or pro rata. For workers who earn ten times the minimum wage or more, severance payments correspond to 20 days of salary for the first year of service and 15 days for each subsequent year of service or pro rata.

Collective Dismissal

The 50 Act of 1990 establishes the requirements for collective dismissal, which in Colombia applies to a dismissal that affects, in a period of six months, several workers equal to:

• 30% of the workers for companies with ten to 50 workers;
• 20% of the workers for companies with 51 to 100 workers;
• 15% of the workers for companies with 101 to 200 workers;
• 9% of the workers for companies with 201 to 500 workers;
• 7% of the workers for companies with 501 to 1,000 workers;
• 5% of the workers for companies with more than 1,000 workers.

For a company to proceed with a collective dismissal, it needs to receive prior authorisation from the Ministry of Labour.

Regarding the obligation for notice periods for termination of employment contracts, it is necessary to differentiate between:

• Fixed-term contracts – notice may be agreed for periods shorter than one year and up to three years, with no more than three extensions equal to less than one year allowed per year. If it is desired for the contract to end by expiration of the agreed term, it is necessary to provide written notice at least 30 days in advance of the expiration of the agreed term; otherwise, it will be extended automatically for a term equal to the initially agreed term.
• Indefinite-term contracts – these may be terminated at any time; no prior notice from the employer is required.

Regarding the submission of resignation by workers, an obligation in paragraph 2, Article 47 of the Colombian Labour Code provides that workers may terminate the contract no less than 30 days in advance; however, since the enactment of Law 789 of 2002, there has been no economic penalty for workers who do not comply with this notice and, in this sense, it is an obligation that cannot be enforced.

The concept of compensation for termination of the contract is provided, in principle, only when an employer makes use of the power granted by law to terminate an employment contract without fair cause.

In this case, compensation must be calculated according to the type of employment contract. As mentioned above, if it is a fixed-term contract, it will be equal to the number of wages until the agreed term is reached, and if it is an indefinite-term agreement, compensation will depend on the compensation tables for each year of service directly related to the worker’s salary and without a maximum limit.

Likewise, paragraph 1, Article 65 of the Labour Code provides that in cases where an employer terminates an employee’s work contract without fair cause, it will be necessary to inform the employee, within 60 days after termination, of the status of payment of contributions to the Social Security System and payroll contributions for the last three months, under penalty that the termination may be declared ineffective if this is not done. 

Protected Positions

In the private sector, in principle, the general rule is that prior authorisation is not required to terminate an employment contract with or without fair cause; however, there are special cases of reinforced labour stability derived from certain conditions, such as:

• termination of employment contracts of union leaders (directors), who cannot be dismissed without fair cause and where prior judicial authorisation is required when there is fair cause;
• workers classified as holding work stability due to health conditions, who cannot be dismissed without fair cause without prior administrative authorisation from the Ministry of Labour;
• women in pregnancy, where authorisation for dismissal is required under the administrative authority of the Ministry of Labour when there is fair cause, and who cannot be dismissed without fair cause during pregnancy and lactation; and
• personnel who are close to pension age (and about to attain the weeks necessary to be entitled to an old-age pension) cannot be dismissed without fair cause.

Procedure and Formalities

In Colombia, termination of the contract with fair cause requires a disciplinary process to be carried out respecting due process, the right of contradiction, and up to two officials from the union to which the worker belongs may participate if the worker so decides; the failures must be asserted, showing the evidence, and currently by way of jurisprudential interpretation, it has been provided that even the right to a second instance or review of the decision within the company should be granted.

Other causes, such as the recognition of the old-age pension for workers, involve a specific procedure, which seeks to ensure that the individual about to retire from service is not affected between the time they are removed, and the date when they start receiving the pension.

In any case, it is important to note that the last paragraph of Article 61 of the Labour Code provides that the party terminating the contract unilaterally must inform the other party about the cause or reason that led to its decision, and is not allowed to subsequently claim other reasons.

This same procedure must be followed when disciplinary sanctions are imposed on workers, which may include the suspension of the work contract without salary, or fines.

Consequences

The consequences of termination of the employment contract with fair cause are termination of the legal relationship between the parties; cessation of reciprocal obligations between the parties; and, finally, the obligation to settle any debts owed to workers (eg, benefits due, unpaid wages).

Article 62 of the Labour Code includes, in a restrictive way, the grounds for termination of the employment contract with fair cause. Such grounds for unilateral termination with fair cause are for both the employer and worker.

Thus, the grounds that an employer can assert in support of terminating an employment contract with fair cause, can be divided between those that originate in the behaviour of the subject (a serious breach, acts of violence, material damage caused intentionally, immoral or criminal acts, preventive detention of worker, and poor performance, among others), and those based on objective criteria (such as recognition of the worker’s right to their old-age pension).

Dismissal for fair cause requires compliance with the procedure that guarantees the due process for the worker, in which the worker knows the breaches that are imputed to them and is aware of the evidence, and can challenge them. Likewise, the Constitutional Court in the constitutionality sentence C 593 of 2014 determined the need for the worker to have the possibility of appealing the decision.

The Colombian legal system, in subparagraph b), Article 61 of the Colombian Labour Code, recognises the possibility of terminating employment contracts by mutual agreement between the parties, without giving rise to any type of severance or compensation.

It is important to bear in mind that the Colombian Labour Code only allows the parties to solve through settlement those employment matters that are debatable, since there are certain indisputable rights that are not negotiable, such as: salary, legal fringe benefits, social security and, in general, the minimum guarantees that the Labour Code provides as workers’ rights.

In Colombia, there are some special protections for workers such as:

• Trade union leaders or directors – trade union organisations in Colombia are governed by the principle of autonomy and in this sense, their creation is carried out in a private act without the participation of the government. Labour laws provide that their legal representation is exercised by the president of the union and a special protection called “union privilege” (fuero) is granted to up to ten members of the union’s board of directors and two members of the statutory commission of claims. The guarantee enjoyed by these workers consists of not being dismissed without fair cause and prior judicial authorisation.
• Women in pregnancy or on lactation leave – women who are pregnant and between 18 weeks up to six months after childbirth enjoy special protection that prohibits their dismissal during this period without authorisation from the Ministry of Labour endorsed with a fair cause for dismissal. While protection varies during pregnancy and maternity leave, it is strongest at the time of lactation. These workers fall under a special category.
• Workers in situations of evident weakness or occupational health disability – as a result of the enactment of Law 361 of 1997 in Colombia, special protection of jurisprudential origin has been provided to workers who have lost their work capacity due to medical issues, seeking to avoid discriminatory actions against their right to work. In principle, workers who prove this condition can only be dismissed without fair cause after authorisation is issued by the Ministry of Labour. However, this protection has had an important jurisprudential evolution and is one of the issues that give rise to “tutela actions” for the protection of fundamental rights.
• Pre-retirement workers – workers who are three years short of reaching retirement age and still have weeks left to qualify for an old-age pension, enjoy special protection.

Decisions may also be taken regarding special protection for mothers or fathers who are considered the head of the family.

In the case of dismissal with fair cause, the worker has a term of three years to raise legal action to discuss the existence of a fair cause and claim the payment of compensation for dismissal which it may receive depending on the date of entry. These three years can be interrupted by a written claim addressed to the employer and could result in a longer term, given that the three years could be computed again for a judicial claim.

After a two-instance judicial proceeding (it could have a review before the Supreme Court of Justice in the special petition of cassation if the amount of the compensation so warrants), the judge can decide whether there was fair cause and if the judge considers that this did not exist, the judge will order the company to pay compensation for dismissal plus indexation.

There are special cases in which it could be argued that the worker deserves reinstatement under the same conditions, with payment of salary and default penalties, as in the case of ineffective dismissals due to the special protection accorded to union leaders or those who, due to their seniority (those employed prior to 1981), are subject to Decree 2351 of 1965.

As provided by Article 13 of the Colombian National Constitution, there can be no discrimination based on sex, race, national or family origin, language, religion, or political or philosophical opinion, and this same rule applies in labour matters.

Colombian labour regulations have several provisions such as Law 361 of 1997 (protection of people with medical disability status); Law 931 of 2004 (equality in work due to age); Law 1496 of 2011 (equal pay and remuneration for all genders), and Law 1010 of 2006 (whereby measures are adopted to prevent workplace harassment) that protect workers from conduct that may be discriminatory.

Within the multiple existing regulations, it is important to highlight that Law 1010 of 2006, which regulates the protection mechanisms against workplace harassment, obliges companies to have committees within the company and mechanisms to avoid situations of labour abuse, labour persecution, labour obstruction, inequality, or lack of protection at work. It also provides workers who lodge complaints of workplace harassment, and their witnesses, with special protection against being dismissed without fair cause within six months of their complaint as a measure of protection against possible retaliatory behaviour.

Dismissal Without Fair Cause and Illegal Dismissal

Likewise, and in a general way, the law makes a distinction between dismissal without fair cause and illegal dismissal. The first is the legitimate power of the employer to terminate an employment contract without an objective cause, or fair cause (under the terms of Article 62 of the Labour Code), for which it must recognise financial compensation. In turn, illegal dismissal occurs when the motivation of the employer infringes the legal system, by way of example, when it unilaterally terminates the contract of a worker with union immunity, without having prior authorisation from a Colombian judge (as determined by the law for these cases), or when it can be proven that its decision originated from prohibited cases.

Thus, it should be noted that illegal dismissal may be subject to complaints to the ordinary courts, as well as via tutela actions, aimed at rendering the employer’s decision ineffective and forcing the same to reinstate the individual to the position previously held.

Permanent use of ITCs in legal proceedings was sanctioned through Law 2213 of 2022. It provides the main requirements for the permanent use of ITCs in judicial proceedings as follows:

• Use of ITCs – to wisely integrate the use of ITCs to aptly oversee legal proceedings and current files and issues, to enable and expedite access to justice.

• Duties of parties to judicial proceedings – to execute and participate in hearings and legal proceedings by using technological tools.

• Judicial files – to develop digital judicial files in a hybrid mode.
• Power of attorney – to grant and recognise power of attorney through data messages, with no handwritten or digital signature required.
• Lawsuit – to indicate the digital channel to serve the parties, legal representatives, and attorneys, as well as any witnesses, legal experts and third parties summoned to the process. Also, if the digital channel is unknown, this must be indicated. The lawsuit and annexes of the complaint will be filed in data messages.
• Hearings – by disposition, hearings will have to be performed using technological resources, although exceptions can be declared by the judge due to exceptional circumstances in the proceeding.

• Service of process – the process will be using data message. It will be considered to have taken place two business days after the notice receipt of the date of dispatch.

• Communications – any communication regarding the legal proceeding will be through the best technical resources available to all the parties involved.

Labour issues and labour lawsuits are addressed in Colombia before a specialised jurisdiction for labour and social security matters, and the proceedings and complaints are conducted in accordance with the provisions of the Labour Code and the Labour and Social Security Procedural Code.

The matters addressed by this jurisdiction include conflicts originating in employment contracts, union privilege actions, union matters for cancellation, and qualifications about the legality of strikes, among others.

Judicial proceedings must be addressed through lawyers who hold the right to appear in court and most cases have two instances of knowledge, apart from matters known by judges for small cases.

Judges for labour matters have the possibility of ruling ultra and extra petita in favour of workers when they find workers’ rights such as salaries, benefits, or compensation, other than those claimed, have been violated but have not been asserted by workers.

When referring to arbitration as a mechanism for dispute resolution, it is necessary to understand that in Colombia the labour contract is essentially deemed as an unequal contract, in which the worker is the weak party of the contractual relationship, and it is understood as an adhesion contract on the conditions imposed by the employer when contracting. On the other hand, collective bargaining agreements and collective covenants are real generators of obligations and in this sense, they are negotiated between the parties.

In this sense, Article 51 of Law 712 of 2001 provides that: 

“The arbitration clause shall only be valid when provided in a collective agreement or covenant and the commitment when recorded in any other document issued by the parties after the controversy arose.”

It is therefore understood that the arbitration clause must be signed before the conflict and commitment, after the controversy.

It is worth noting that the mechanism of arbitration for conflict resolution is used in labour matters, to solve conflicts arising after a collective bargaining process that is not resolved by agreement, and it assumes that an arbitral tribunal (three-party with arbitrators appointed by the employer, union and mutual agreement or the Ministry of Labour) will resolve, in equity not in law, the unresolved issues within the collective bargaining process.

Therefore, a clause of this nature that is not included in a collective agreement is not enforceable.

In Colombia, there is clear regulation on the so-called concept, “protected by poverty”, according to which, when any person is not able to bear the costs of proceedings without undermining what is necessary for their own subsistence and for their dependants, they can request before the proceeding or during the same to have an “assigned counsel” appointed by stating the above under oath. 

Such assigned counsel has the same obligations of definition and loyalty to the client, and all lawyers in Colombia are obliged to accept this type of appointment.