COLOMBIA Law and Practice Contributed by: Jaime Trujillo, Juan David Velasco, Natalia Ponce de León and Angelica Navarro, Baker McKenzie S.A.S.
recorded in minutes, which must also be incorporated into the corresponding company’s minutes ledger. A foreign branch does not have any separate gov - ernance bodies from its home office. Instead, a legal representative or general agent acts on behalf of the company, suggesting more centralised control from the parent company. 3.5 Directors’, Officers’ and Shareholders’ Liability Shareholders of corporations (SA) and simplified stock corporations (SAS) are only liable up to the amount of their respective contributions. However, it is possible to pierce the corporate veil if the company is used to defraud the law or to the detriment of third parties. In these cases, the shareholders and administrators who have carried out, participated in or facilitated the fraudulent acts are liable too. However, piercing the corporate veil involves a high burden of proof, and the specialist company court rarely finds sufficient evidence to do so. The business judgement rule applies to administrators and usually does not interfere with the normal course of business of administrators or companies. However, the law establishes certain duties for administrators that they need to uphold, with the most important being acting with loyalty and diligence and in the interest of the company. If shareholders consider that an administrator has not acted accordingly, they can commence a corporate action for liability ( acción social por responsabilidad ), and an administrator who has breached their duties can be liable for the dam - ages caused to the company.
• the collective bargaining agreements (where appli - cable); and • in some cases, by consistent case law (where not expressly regulated by law). 4.2 Characteristics of Employment Contracts Employment agreements in Colombia can be agreed verbally. Although not required by law, for evidence purposes it is advisable to formalise the terms of the employment relationship in writing and ensure that the written agreement contains certain minimum informa - tion (eg, initiation date, type of contract and events of termination for cause). Some provisions are only valid if agreed in writing, such as: • trial period; • the characterisation of salary as being “compre - hensive” ( salario integral ); and • fixed-term duration of the employment agreement – this type of arrangement can only have a total duration of four years. 4.3 Working Time The ordinary working hours are those agreed by the parties, or, in the absence of an agreement, the estab - lished legal maximum, which is currently 44 hours per week (this is being gradually reduced so that, by 15 July 2026, it will be 42 hours). Overtime work is that exceeding the ordinary working hours of the company and, in all cases, that exceed - ing the legal maximum working hours. Overtime work may never exceed two hours a day and 12 hours a week. The labour reform, approved by Congress in June 2025, eliminated the requirement for employers to obtain authorisation from the Ministry of Labour for employees to work overtime. Overtime work must be remunerated as follows: • daily overtime work (between 6.01am and 7pm) – 25% over the value of daily ordinary work; • nightly overtime work (between 7.01pm and 6am) – 75% over the value of daily ordinary work; and • regular night work (not overtime) – 35% over the value of daily ordinary work. Employers and employees may mutually agree on legally defined special flexible schedules or shifts that
4. Employment Law 4.1 Nature of Applicable Regulations
Even though Colombia follows a civil law system, con - sistent case law can also be binding precedents on the parties to a dispute. Employment relationships are governed by: • the law; • the employment contracts;
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