COLOMBIA Law and Practice Contributed by: Jaime Trujillo, Juan David Velasco, Natalia Ponce de León and Angelica Navarro, Baker McKenzie S.A.S.
To proceed with a collective dismissal, the employer must obtain prior authorisation from the Ministry of Labour. The Ministry can, at its discretion, approve or reject this request. In practice, the Ministry is often reluctant to grant such authorisation, typically tak - ing more than 12 months to review the request and possibly denying it. Mass layoffs conducted with - out authorisation from the Ministry of Labour, or in cases where such authorisation has been denied, will be considered void. Consequently, employees must be reinstated with back-pay for salaries and labour benefits accrued but not paid during the period of unemployment. 4.5 Employee Representations In Colombia, works councils/employee representa - tive bodies do not exist as such. However, employees have the right to form or join unions. A union must have a minimum of 25 members, each of whom must be at least 14 years old, in order to be formed. These requirements must be certified at an initial constitution meeting and executed with the intention to become unionised employees, at which time the employees will sign a foundation minute. The foundation minute is one of the requirements that must be fulfilled to register the union with the Ministry of Labour. To become part of an already existing union, employ - ees must be at least 14 years old and meet the require - ments established in the by-laws of the union. Unions are authorised to enter into collective bargain - ing agreements on behalf of the affiliated employees. In addition to the provisions agreed upon between the parties, the collective bargaining agreement must indicate: • the company or establishment; • industry and trades covered thereby; • the place or places where it is to govern; • the date on which it takes effect, its duration, and the causes and methods of its renewal and termi - nation; and • the responsibility for non-performance.
Irrespective of the kind of union or the number of affiliates working for an employer, negotiation is held primarily by each union within an entity. An employee may belong to more than one union, and unions of the same or a different nature may coexist in the same company. Recent reforms formally enable multi-level collective bargaining beyond the company level, including nego - tiations at the level of groups of companies, branches of economic activity, or entire sectors. The new rules mandate unified bargaining agendas and negotiating tables when multiple unions or employers participate above the company. They also introduce criteria to determine representativeness and allow higher-level agreements to set sector-wide minimum standards of protection. While company level agreements remain in force, higher level agreements prevail when they provide more favourable conditions, in line with the principles of favourability, progressivity and non- regressivity. The new regulatory design leaves several practical and institutional questions unresolved, particularly regarding how employer representativeness will be determined in heterogeneous sectors, how competing employer associations will be co-ordinated, and how differentiated treatment for micro, small and medium- sized enterprises will operate in practice. The new regime also raises issues concerning the extension of sector-level agreements for all employees within the sector, regardless of union membership, coupled with limitations on the ability to renounce benefits. It also gives rise to questions about its economic impact, as well as the absence of clear rules on the exercise of the right to strike in multi-employer or sectoral nego - tiations.
5. Tax Law 5.1 Taxes Applicable to Employees/ Employers
Employees are subject to payment of income tax, at rates that depend on the employee’s total income and/or compensation earned during the correspond - ing fiscal year and that range from 0% to 39% of the employee’s taxable income.
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