Employer Payroll Tax
Employee Payroll Taxes
The minimum gross monthly wage in Colombia is $877,803.00 COP. In addition to this, there is a monthly transportation subsidy of $102,854.00.
Pay date is either on the 15th or the last day of the month, depending if the payroll cycle is bi-monthly or monthly.
Full time employment is considered 48 hours weekly, and 8 hours daily. Hours in one day cannot exceed 10.
Maximum overtime in one week is 12 hours.
Daytime Overtime – Regular wage +25%
Night Overtime – Regular wage +75%
Sunday/Holiday Extra Daytime – Regular wage +75% per holiday/+25% daytime surcharge
Sunday/Holiday Overtime – Regular wage +75% per holiday/night surcharge
Employers contribute 25% and employees contribute 8% of salary. Contributions are towards funds for pension, medical plan, and family welfare fund.
The employer contributes 12%. The employee contributes 4%.
There is also a mandatory 13th and 14th salary (each amounting half a month’s salary) that are paid out in June and December.
15 days per year
18 public holidays
Maternity leave is 18 weeks, paid at a rate of 100% salary. The employer makes the payment to the employee and then claim the money back through EPS.
Paternity leave is 8 working days, paid at a rate of 100% salary. The employer makes the payment to the employee and then claim the money back through EPS.
There is no additional statutory parental leave other than maternity and paternity leave in Colombia.
Bereavement leave: depends on the blood relationship and affinity with the deceased and is assumed by the company (5 working days). Leave can be paid or unpaid, it is up to the employer to decide (depend of the company).
Marriage leave: is for 5 working days and is assumed by the company.
The termination depends on the reasons to carry out this process to the worker, if it is with just cause, there are no courts, if it is without just cause, first must review the compensation according to the time spent in the company, if other reasons must be seen in detail to give an opinion.
- If the termination is initiated by the employer, it is not mandatory for the employer to give a reason for termination unless there is an allegation of an unfair cause.
- For pregnant or disabled employees- the employer must get special permission to terminate the employee.
- For unionized employees- the employer must get permission from a labor judge in order to terminate an employee.
- If the employee terminates the employment contract due to a breach by the employer, they are entitled to severance payment.
A maximum of 15 days’ written notice is required in cases of poor performance. The employee must have at least 24 hours to review the dismissal notification and respond.
In the case of misconduct or dismissal with a just cause, the due process of calling for discharge is carried out, and the contract is terminated.
For employees with a fixed term agreement, written notice is required at least 30 days prior to the agreement’s expiration.
When the termination is without a cause, employers are obligated to pay severance. For employees with an indefinite term agreement (permanent contract), the severance will be calculated as follows:
- Employees earning less than 10 minimum legal monthly wages (in 2020 COP$8,778,030), will be entitled to 30 days of salary for the first year of service and 20 days of salary for each additional year of service.
- Employees earning 10 minimum legal wages or more, will be entitled to 20 days of salary for the first year of service and 15 days of salary for each additional year of service.
- For employees with a fixed-term agreement, the severance would be equal to the salary of the employee until the term of the agreement expires.
Employees who entered into agreements for the duration of a project, will be entitled to the estimated salary owed to the employee until the project concludes, with a minimum of 15 days of salary.
A maximum of Two months for permanent contracts.
For fixed term contracts, the probation period cannot exceed more than 1/5th of the initial agreed employment term.
19% standard rate