Colombia

Employer Income Tax Obligations:

• Employers in Colombia must contribute to funds including a 12% contribution to the Pension Fund, an 8.5% contribution to the Healthcare Fund, a contribution of 0.348-8.7% to the General Labor Risk Pool, a 4% contribution to the Family Allowance Fund, a 3% contribution to the Colombian Institute for Family Welfare (ICBF), and a 2% contribution to the National Learning Service (SENA). These contributions amount to a total cost of employment ranging from 29.848% to 36.2%.

Employee Payroll Tax Obligations:

• Employees in Colombia are also subject to payroll taxes. These include a 4% contribution to the Pension Fund, a 4% contribution to the Healthcare Fund, and a contribution of 0.348-8.7% to the General Labor Risk Pool.

Employee Income Tax Obligations::

• In terms of income taxes, the percentage varies based on the employee's income level. For instance, individuals earning up to 1,090 tax units are not required to pay any income tax.
  
  It's worth noting that in Colombia, the tax system underwent significant reform in 2006 with the introduction of the 'tax unit' (Unidad de Valor Tributario or TVU). The value of the tax unit may be adjusted annually, and in 2021, it is COP 36,308. Therefore, the income thresholds for each income tax bracket may vary from year to year.

• Statutory leave:
  All employees in Colombia are entitled to 15 working days of paid annual leave and 18 paid public holidays.


• Pregnancy and maternity leave:
  Mothers in Colombia receive 18 weeks of paid maternity leave at 100% of their standard salary, starting up to two weeks before the due date or on the day of birth. The same benefit applies to adoptive mothers and partners of women unable to care for the child. Employers pay upfront but can later get a refund from the government.


• Paternal leave:
  Colombian fathers receive two weeks of paternity leave at 100% of their salary.


• Other leaves
  
  • Bereavement leave: In Colombia, employees can take up to five consecutive days of leave.
  • Marriage leave: After getting married, employees are entitled to 5 consecutive days of paid leave.
  
  

Any party seeking to unilaterally terminate an employment contract must provide a written statement indicating the cause or motive behind such termination, except under certain special circumstances. Employers must also provide a "fair" reason for terminating an employee in order to avoid legal repercussions in the form of penalties and fines.

Furthermore, the termination process must adhere strictly to the regulations established by employment contract law, salary law, and social security regulations.

• Notice period
  The statutory period in Colombia depends on a number of factors. If an employee is terminated for misconduct, there is no requirement for notice. However, if the worker is on a fixed-term contract, written notice must be provided to the employee at least 30 days before the contract ends. On the other hand, for employees not on fixed-term contracts, a notice of at least 15 days must be given when the employee is terminated due to poor performance. It is worth noting that in such cases, the employee has the right to respond to the termination within 24 hours to challenge the decision.


• Severance pay
  Colombian employees have the right to severance pay depending on their salary, the nature of agreement with an employer, and the nature of termination.
  
  For a fixed-term agreement, the severance payment is the employee's remaining salary until the contract's end date. However, for indefinite agreements, the amount of severance payment depends on the employee's current salary and the duration of their service. Workers who earn less than COP$9,085,260 receive 30 days' pay for their first year of employment and 20 days' pay for each subsequent year. Meanwhile, those who earn more than 10 times the monthly minimum wage receive 20 days' pay after one year and 15 days' pay for every additional year.


• Probationary period
  Probationary periods should be in writing and have a maximum duration of two months for undefined term contracts and fixed term contracts of one to three years. For fixed-term contracts of less than a year, the probationary period cannot be longer than one-fifth of the agreed term, up to a maximum of two months.