Thinking of hiring remote employees in Colombia? Colombia's talented workforce and growing tech sector make it an attractive choice for global expansion. You'll find skilled professionals at competitive costs, all within a business-friendly environment that values both economic growth and worker protections.
However, you’ll want to familiarize yourself with Colombia's employment laws before you make your first hire.
The Código Sustantivo del Trabajo (Labor Code) establishes detailed requirements for everything from working hours and benefits to termination procedures and contributions to the social security system. Following these regulations is essential to remain compliant and prevent costly errors.
Key takeaways:
- Colombia's Labor Code applies to all employment relationships, with recent updates addressing remote work, data protection, and the right to disconnect.
- Employers must contribute over 30% of gross wages to mandatory social programs, including health insurance, pensions, and occupational risk coverage.
- Colombian employees are entitled to several benefits, including 15 days of annual vacation, 18 public holidays, paid parental leave, and a mandatory 13th-month bonus payment.
Labor Laws in Colombia: What You Need to Know
Colombia's employment framework centers on the Código Sustantivo del Trabajo (CST), the comprehensive Labor Code that governs all employment relationships in the country.
Whether a company is hiring someone to work from their home office in Medellín or bringing on a remote team member in Bogotá, this legislation covers everyone.
Recent reforms have modernized Colombia's labor laws for today's global economy. Law 1221 of 2008 introduced telework provisions, while Law 2088 of 2021 established comprehensive remote work regulations.
These updates clarify employer obligations regarding working hours, equipment provision, health and safety in virtual workplaces, and employees' right to disconnect outside scheduled hours.
Who Is Covered by the Employment Laws in Colombia?
Colombian labor laws cover virtually all private-sector employees working full-time, part-time, on fixed-term contracts, or remotely. These protections extend equally to Colombian nationals and foreign workers with valid work authorization.
Public-sector employees are covered under a separate set of laws, while independent contractors operate under civil and commercial law rather than the CST. However, most employer-employee relationships fall under the Labor Code's comprehensive protections.
General Data Protection Law
Colombia regulates employee data privacy under Law 1581 of 2012 and Decree 1377 of 2013, treating employee privacy as a constitutional right. Employers must:
- Obtain employees' informed and express consent before processing personal or sensitive data
- Only use data for legitimate work purposes
- Allow employees to access or request the deletion of their information
The Superintendence of Industry and Commerce (SIC) enforces these obligations, with violations carrying fines up to 2,000 times the minimum wage.
Transferring employee data abroad requires additional protection safeguards, making compliance essential for international employers hiring in Colombia.
Employment Contracts & Probation Periods
In Colombia, all employment relationships require a contract, and having a written agreement is strongly advised to ensure clarity for both parties.
The Labor Code recognizes three main contract types:
- Indefinite-term contracts serve as the default for ongoing employment relationships.
- Fixed-term contracts can last up to three years with possible renewal, though consecutive fixed-term agreements are capped at four years.
- Work or task-based contracts tie employment to completing specific projects rather than set timeframes.
Probation periods must be stipulated in contracts and typically last up to two months.
Colombian employees have the right to join unions, and collective bargaining agreements (CBA) take precedence over individual contract terms when applicable. CBA provisions must be included in employment contracts.
Working Hours & Wages
Colombia is gradually reducing its standard workweek from 48 to 42 hours. As of July 2025, the limit dropped to 44 hours, with a final reduction to 42 hours set for July 2026.
Employees can only work up to two hours of overtime per day and no more than 12 hours a week. Daytime overtime is paid at 125% of the regular rate, while nighttime overtime (7 p.m. to 6 a.m.) pays 175%.
As of 2025, Colombia's minimum wage is COP 1,423,500 monthly, plus a COP 200,000 transport allowance for eligible employees.
All employees are entitled to mandatory 13th-month pay (prima de servicios) — a bonus equivalent to one month's salary that employers must pay in two installments: half due by June 30 and half by December 20.
Health & Safety Standards
Colombian law requires employers to provide safe working environments through comprehensive health and safety regulations. Law 1562 of 2012 modernized occupational risk management, while Decree 1072 of 2015 consolidated safety requirements.
Every employer must implement a Safety and Health at Work Management System (SG-SST) that:
- Evaluates risks
- Provides appropriate training and equipment
- Continuously improves workplace conditions
This system extends to contractors and subcontractors, ensuring comprehensive workplace protection.
Companies must register employees with an ARL (Administradora de Riesgos Laborales) to provide occupational risk insurance. These insurers classify job roles by risk level, offer technical support, and cover work-related accidents or occupational illnesses.
Employer Taxes
Hiring in Colombia requires employer contributions to mandatory social programs, which typically exceed 30% of employee gross wages and include:
- Health insurance (EPS): 8.5% of salary for national health system coverage
- Pension fund: 12% toward employee retirement security
- Occupational risk insurance (ARL): 0.522% to 6.96% depending on risk classification
- Parafiscal contributions:
- 4% Family Compensation Fund
- 3% Colombian Institute of Family Welfare
- 2% National Training Service
These programs ensure Colombian employees receive comprehensive social protection.
Retirement Contributions
Colombia's pension system provides employee retirement security through public (Colpensiones) or private pension administrators (AFPs). Total contributions equal 16% of an employee’s monthly salary, with employers paying 12% and employees contributing 4% through payroll deduction.
Termination Guidelines & Severance Pay
At-will employment does not exist in Colombia. Instead, the CST establishes clear termination rules that employers must follow.
Fixed-term contracts require 30 days' notice before expiration if not renewed. Employers must provide just cause or severance pay to terminate indefinite-term contracts.
Severance is based on salary and service length:
- Employees earning less than 10x minimum wage: 30 days' salary for the first year, plus 20 days for each additional year
- Employees earning 10x minimum wage or more: 20 days' salary for the first year, plus 15 days for each additional year
Colombia also requires a severance savings system (cesantías). Employers contribute one month's salary annually to dedicated employee funds, plus 12% annual interest paid each January. Employees can access these funds upon job loss or for specific purposes like education or housing.
Health Insurance
Colombia offers universal healthcare through the Sistema General de Seguridad Social en Salud (SGSSS), a mixed public-private model ensuring medical access for all residents. Employers must register new hires with an EPS (Entidad Promotora de Salud) health insurer.
Health contributions total 12.5% of an employee’s monthly salary: employers pay 8.5% while employees contribute 4% through payroll deduction. This coverage includes comprehensive medical services from routine care to specialist treatment, as well as coverage for dependents.
Paid Leave Laws
Colombia emphasizes work-life balance and support for employees through various mandatory paid leave programs.
Vacation and Holiday Leave
Employees earn 15 days of paid vacation annually. In addition, Colombia observes 18 national public holidays each year, including:
- New Year's Day
- Labor Day
- Holy Week
- Independence Day
- Christmas
Sick Leave
If an employee is sick, employers cover wages for the first two days of illness. From days three to 90, employers pay employees 66.7% of their salary, which is reimbursed by the public health insurance system (EPS).
If an illness extends beyond that, EPS covers 50% of the employee’s salary up to 180 days.
Parental Leave
Pregnant employees receive 18 weeks of fully paid maternity leave, which typically starts one week before the due date, and fathers receive two weeks of paid paternity leave. As with sick leave, employers initially pay for parental leave and are reimbursed by EPS.
Parents have the option to share the last six weeks of maternity leave, provided the mother takes the first 12 weeks.
Colombian Independent Contractors
Companies can hire independent contractors in Colombia under civil and commercial law rather than the Labor Code. The key distinction is subordination: employees work under employer direction while contractors maintain autonomy over how, when, and where they perform services.
To avoid misclassification — which can trigger significant penalties and back payments — employers should not impose employee-style conditions, such as mandating contractors work a set schedule or at a fixed location.
Independent contractors are responsible for making their own tax and social security contributions.
Penalties for Not Following Colombian Labor Laws
The Ministry of Labor enforces compliance through administrative fines up to 5,000 times the monthly minimum wage per violation. Penalties apply to issues like failing to register employees with social security, ignoring working-time limits, or mishandling terminations.
Occupational health and safety violations can result in financial penalties or temporary operational suspension. Data privacy violations carry fines up to 2,000 times minimum wage, plus orders to suspend or delete improperly managed data.
How to Stay Compliant When Hiring in Colombia
International employers have two main options for compliant hiring in Colombia:
- Establish a local entity: This involves incorporating a Colombian subsidiary, registering with tax and social security authorities, setting up payroll systems, and maintaining ongoing compliance. While providing maximum control, entity establishment is time-consuming and costly, often requiring months before onboarding the first employee.
- Partner with an Employer of Record (EOR): An EOR becomes the legal employer while you maintain operational control over day-to-day work. The EOR handles employment contracts, social security enrollment, payroll processing, mandatory contributions, and labor law compliance. This approach enables faster hiring with lower administrative overhead and reduced compliance risk.
For many global companies, working with an EOR is the preferred way to hire in Colombia. It lets you test the market and scale your team without the upfront cost and complexity of setting up a local entity.
Hire in Colombia with RemoFirst
Ready to tap into the wealth of talent in Colombia? RemoFirst enables companies to employ talented individuals in 185+ countries, including Colombia, without establishing local entities.
Let RemoFirst handle the compliance complexities so you can focus on building and growing your team. We create locally compliant contracts, manage social security registrations, pay your employees in Colombian pesos, and handle all federal and local labor law requirements.
Ready to build your Colombian team without complexity? Book a demo to see how RemoFirst can transform your international hiring process.
