and contractors in Colombia
Remote’s guide to employing in Colombia.
Facts & stats
The second-most populous country in South America, Colombia is the only country on the continent with beaches on both the Caribbean Sea and the Atlantic Ocean. Colombia is well known for its coffee and its vibrant arts scene. With many public holidays (the second-most in the world, behind only India), plentiful natural resources, and a large population, Colombia is home to expert workers in a variety of important fields.
Grow your team in Colombia with Remote
To employ someone in Colombia, an employer must use a legal entity in the country to manage payroll, tax, benefits, and compliance through in-country resources. The complexity of employment regulations in Colombia can make full compliance with employment laws cumbersome and difficult, especially for companies that have not employed there before.
Through Remote's global employment and global payroll solutions, we can employ your team members in Colombia on your behalf through our local legal entity. We take care of payroll, tax, benefits, and compliance, so you can focus on growing your business.
Colombia, like many other countries, treats self-employed contractors and full-time employees differently. Misclassification of contractors in Colombia may lead to fines and penalties for the offending company.
Employing in Colombia
Colombia has many skilled workers, most of whom primarily speak Spanish, the country’s official language. Before you recruit Colombian or expat employees, you should understand the specifics of Colombian employment and labor laws.
Employment contracts are required for both fixed-term employment and permanent employment agreements. Remote recommends employment contracts for every hire, and every contract must adhere to Colombian employment and labour laws. Usually, fixed-term contracts in Colombia cannot be for more than three years, though there is a provision to extend them to a later date. The contracts are usually drafted in Spanish.
To employ workers in Colombia, contact Remote to learn more about your options.
|Date||Holiday Name||Extra information|
|New Year's Day|
|Saint Joseph's Day|
|Maundy Thursday and Good Friday|
|Ascension of Jesus|
|Saint Peter and Saint Paul|
|Declaration of Independence|
|Battle of Boyacá|
|Assumption of Mary|
|All Saints’ Day|
|Independence of Cartagena|
In Colombia, the minimum wage is 908,526 pesos (around US $260) per month. The minimum wage increased in 2021 from 877,803 pesos in 2020.
Employees in Colombia receive an extra month’s pay each year, split between two payments: one in June and one in December. These payments are not only customary but are required by law.
- For customers of Remote, all employee payments will be made in equal monthly instalments on or before the last working day of each calendar month, payable in arrears.
We can help you get a new employee started in Colombia fast. The minimum onboarding time we need is only 2-3 weeks before start date.
Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.
For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.
Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.
Competitive benefits package in Colombia
Beyond providing your employees with all statutory benefits in Colombia, Remote can help you create a custom benefits package for your Colombia team. A competitive benefits package may include perks such as:
Taxes in Colombia
Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Colombia.
- 12.00% - Pension Fund
- 8.50% - Healthcare Fund
- 0.348 - 8.7% - General Labor Risk Pool
- 4% - Family Allowance Fund
- 3% - Colombian Institute for Family Welfare (ICBF)
- 2% - National Learning Service (SENA)
- 29.848-36.2% - Total Cost of Employment
Employee payroll taxes
- 4.0% - Pension Fund
- 4.0% - Healthcare Fund
- 0.348-8.7% - General Labor Risk Pool
Employee income taxes
- 0 (Income up to 1090 tax units)
- 19.0% (1090 to 1700 tax units + 116 tax units)
- 28.0% (1700 to 4100 tax units + 788 tax units)
- 33.0% (4100 to 8670 tax units + 788 tax units)
- 35.0% (8670 to 18970 tax units + 2,296 tax units)
- 37.0% (18970 to 31000 tax units + 5,901 tax units)
- 39.0% (31000 tax units and up + 10,352 tax units)
Note: The Columbian government approved an important reform to the tax system in 2006 with a 'tax unit' (Unidad de Valor Tributario or TVU), so the number may be adjusted every year. In 2020, one tax unit was COP 35,607, and in 2021, it is COP 36,308.
Types of leave
All full-time employees are entitled to 15 consecutive working days of paid annual leave. Every employee is also entitled to 18 paid public holidays.
- Pregnancy and
Mothers in Colombia receive 18 weeks of maternity leave, typically beginning one week before the child’s due date, paid at 100% their standard salary. Mothers may take the leave up to two weeks prior to their due date or can begin the leave on the day of the birth, if necessary. This leave also applies to mothers who adopt and partners of women who become sick or otherwise unable to care for the child.
Employers must pay for maternity and paternity leave upfront but receive a refund from the government later.
In Colombia, fathers receive eight paid days of paternity leave. Compensation for paternity leave is set at 100% of the employee’s salary.
- Bereavement leave: In Colombia, employees can take up to five consecutive days of leave.
- Marriage leave: After getting married, employees are entitled to 5 consecutive days of paid leave.
Either party unilaterally terminating the employment contract must state in writing at the time of termination the cause or motive that led to the termination, except in some special cases.
The termination process must follow rules and regulations set by employment contract law, salary law, and social security regulations. Employers must offer a “fair” reason for terminating the employee in the eyes of the law or risk penalties and fines.
The statutory notice period in Colombia depends on the context:
- Notice is not required if an employee is terminated for misconduct.
- For workers on a fixed-term contract, written notice must be sent to the employee 30 days before the contract expires.
- For employees not on fixed-term contracts, 15 days notice must be given when the employee is dismissed for poor performance. In these cases, the employee can respond to the termination within 24 hours to challenge the decision.
In Colombia, the amount a company must pay as severance depends on the nature of termination, the current salary of the employee, and the type of agreement.
In the case of a fixed-term agreement, the severance must be the balance of salary due to the employee up to the last date of the agreement.
In the case of an indefinite agreement, severance varies based on the number of years of service and the current salary of the employee.
- Employees earning less than COP$9,085,260 (10 times the monthly minimum wage) receive 30 days’ salary for the first year of employment and 20 days’ salary for each additional year.
- Employees who earn more than 10 times the monthly minimum wage receive 20 days’ salary after one year and 15 days’ salary for every additional year with the company.
The maximum probationary period for employees in Colombia is two months.