COLOMBIA Law and Practice Contributed by: Jaime Trujillo, Juan David Velasco, Natalia Ponce de León and Angelica Navarro, Baker McKenzie S.A.S.
are tailored to the business activities of the employer and the duties of the employees. Depending on the types of schedules or shifts, overtime payments may not apply. Employees classified as direction, trust and/or man - agement personnel are not entitled to receive overtime surcharges. 4.4 Termination of Employment Contracts Generally, Colombia is an employment-at-will jurisdic - tion, as an employment agreement may be terminated by the unilateral decision of either of the parties, with or without just cause. Employment can also be termi - nated by mutual consent of the parties, by the termi - nation of the fixed-term agreed upon or by failure to extend the probation period. For probationary purposes, the employer should pro - vide written notification to the employee in the case of employment termination. In some cases, the employer must give the employee advance notice of no less than 15 days. These include where the employer terminates the employment agreement due to recognition of a retirement pension if the employee is still providing services. Apart from those very specific cases, employment law does not require advance notice for the termination of employ - ment contracts, except in the case of non-renewal of fixed-term contracts. Notice of non-renewal of a fixed- term contract must be provided at least 30 calendar days in advance of the date of the expiry term. If it is not, the contract will be automatically renewed. Employers must pay employees amounts due imme - diately upon termination (eg, salaries, outstanding vacations, accrued social benefits, outstanding com - missions, and any other labour benefit owed). The exact amounts vary depending on the agreed salary structure (eg, comprehensive salary ( salario integral ) or ordinary salary plus mandatory benefits structure) and the termination scenario (eg, dismissal without just cause, mutual consent or resignation). Unilateral termination without cause will give rise to the payment of statutory severance. The formula to calculate the statutory severance upon unilateral ter -
mination without cause depends on the employee’s monthly salary, whether the labour contract is for a fixed or indefinite period of duration, and the actual time of duration of the employment. For indefinite-term contracts, the legal severance for dismissal is as follows: • for employees who earn less than ten minimum legal monthly salaries (for 2026, COP17.509 million or USD4,669), the severance is equivalent to 30 days of salary for the first year of service and 20 additional days of salary for each additional year of service, proportionally per fraction; • for employees who earn ten minimum legal month - ly salaries or more, the severance is equivalent to 20 days of salary for the first year of service and 15 additional days of salary for each additional year of service, proportionally per fraction; • for employees who had more than ten years of service as of 27 December 2002, the severance is equivalent to 45 days’ salary for the first year of service and 40 additional days of salary for each year subsequent to the first, proportionally for frac - tions of the year; and • for employees who had ten years of service or more as of 31 December 1990 and are entitled to reinstatement, the severance is equivalent to 45 days of salary for the first year of service and 30 additional days of salary for each year subsequent to the first, proportionally for fractions of the year. For agreements entered into under a fixed period or for the duration of a specific job or activity, the sever - ance is equivalent to the salaries corresponding to the unexpired period of the contract, or to the term remaining for the completion of the specific job or activity, which cannot be less than 15 days of salary. Under Colombian law, a collective dismissal occurs when an employer unilaterally and without just cause terminates the employment agreements of a certain percentage of its employees within a period of six consecutive months, without the required authorisa - tion from the Ministry of Labour. These percentages, which are established by law, vary depending on the size of the company’s workforce.
220 CHAMBERS.COM
Powered by FlippingBook