Employer of Record (EOR) in Colombia | 2025 Update
Expanding your business into Colombia offers a wealth of opportunities, from accessing a skilled workforce to entering one of Latin America’s fastest-growing markets. However, navigating Colombia’s labor laws, payroll requirements, and compliance complexities can be daunting. Partnering with an Employer of Record (EOR) simplifies this process, allowing businesses to hire top talent in Colombia without establishing a legal entity.
This guide explains how an EOR in Colombia works, its benefits, and how it can help you expand your operations efficiently and compliantly.
What Is an Employer of Record in Colombia
An Employer of Record (EOR) is a local entity that handles the legal and administrative responsibilities of employing staff in Colombia. While the EOR acts as the legal employer, you retain full control over your employees’ daily activities and responsibilities.
EOR services include:
- Managing payroll and taxes.
- Ensuring compliance with Colombian labor laws.
- Providing statutory and supplemental benefits.
- Handling employment contracts.
With an EOR, businesses can avoid the complexities of entity setup, allowing for faster, more efficient expansion.
➡️ Learn more: What Is an Employer of Record (EOR)?.
Employment in Colombia
Colombian labor laws are governed by the Colombian Labor Code (Código Sustantivo del Trabajo). These laws ensure fair treatment of employees and regulate everything from hiring practices to termination. Compliance is critical to avoid legal penalties and maintain operational success.
Employers must strictly follow the law to avoid legal issues. Compliance ensures smooth hiring and operational success.
Employment Contracts in Colombia
All employment relationships in Colombia require a written contract. These contracts must include:
- Personal details of both parties.
- Job responsibilities and location.
- Salary and payment frequency.
- Working hours and benefits.
- Duration of employment (fixed-term or indefinite).
- Probationary period terms, if applicable.
Colombian labor law strictly regulates contract types to ensure employee protections.
Probationary periods in Colombia
In Colombia, probationary periods are legally recognized and must be agreed upon in writing as part of the employment contract.
According to the Colombian Labor Code, the maximum duration of a probationary period is two months for indefinite-term contracts. For fixed-term contracts shorter than one year, the probationary period cannot exceed 20% of the total contract duration.
Average working hours in Colombia
A standard workweek in Colombia consists of 48 hours, typically distributed across six days. Employees are entitled to at least one rest day per week.
Overtime
Overtime is compensated at higher rates:
- 125% of the regular hourly wage for daytime hours.
- 175% for night shifts.
- Overtime cannot exceed two hours per day or 12 hours per week.
An EOR ensures accurate overtime calculations and compliance with Colombian regulations.
Leave in Colombia
Annual Leave Accrual Entitlement
Employees in Colombia are entitled to 15 business days of paid annual leave after completing one year of service. Employers must schedule leave within a year of accrual to comply with labor laws.
Public Holidays
Colombia has 18 public holidays, one of the highest numbers globally. Employees enjoy paid time off for these days.
Maternity, Paternity and adoption Leave
Mothers are entitled to 18 weeks of paid maternity leave, while fathers receive two weeks of paid paternity leave. An EOR ensures compliance with parental leave regulations, providing seamless support.
➡️ Check our complete guide: Parental Leave in Colombia
Sick Leave
Employees can take paid sick leave if certified by a healthcare provider. The Colombian Social Security System reimburses up to 66% of wages after the first two days.
Payroll in Colombia
Payroll cycles in Colombia
Employers in Colombia typically pay salaries monthly, though biweekly cycles are also acceptable. An EOR handles payroll processing to ensure timely payments and accurate calculations.
Wages in Colombia
As of 2025, Colombia’s minimum wage is 1,423,500 COP per month, plus a mandatory transportation allowance of 200,000 COP for employees earning up to twice the minimum wage.
➡️ Check our complete guide: Minimum Wage in Colombia for 2025
Payroll contributions for employers
Employers in Colombia are responsible for several payroll taxes and contributions:
| Contribution | Rate | Purpose |
|---|---|---|
| Social Security (Pension Fund) | 12% of salary | Retirement and disability benefits. |
| Health Insurance | 8.5% of salary | Healthcare for employees and dependents. |
| Labor Risks (ARL) | 0.522%–6.96% | Coverage for occupational accidents. |
| Family Compensation Fund (CCF) | 4% of salary | Subsidies for employee welfare and training. |
| SENA, ICBF, and CCF (Parafiscales) | 9% of salary | Funding for vocational training and childcare. |
Payroll contributions for employees
Employees also contribute to social security:
- Pension Fund: 4% of salary.
- Health Insurance: 4% of salary.
Streamline Your Expansion with EOR Services in LATAM
Expand across Latin America effortlessly with our Employer of Record (EOR) services. We handle compliance, payroll, and employee management, ensuring smooth operations while you focus on growing your business.
Benefits in Colombia
Mandatory benefits in Colombia
The Colombian Social Security System provides essential benefits, including:
- Retirement pensions.
- Disability and survivor benefits.
- Universal healthcare.
- Maternity and paternity leave.
- Sick leave reimbursements.
Supplemental benefits in Colombia
To attract top talent, many employers offer additional perks such as:
- Private Health Insurance: Complements public healthcare, providing access to private medical services.
- Transportation Benefits: Subsidies or allowances for commuting costs.
- Meal Vouchers: Reloadable cards for food purchases, tax-deductible for employers.
- Performance Bonuses: Rewards tied to productivity, exempt from income tax. An EOR in Colombia helps design competitive benefits packages that comply with local regulations.
Terminations in Colombia
Notice Periods in Colombia
Colombian labor law does not mandate notice periods for termination, but employers must comply with severance payment requirements
Severance pay in Colombia
Employees terminated without cause are entitled to:
- 30 days’ wages for the first year of service.
- 20 days’ wages for each additional year. Accrued benefits, including unused leave and bonuses, must also be paid.
An EOR ensures compliance with termination procedures, minimizing legal risks.
Types of Visas in Colombia: Understanding Your Options
Foreign nationals working in Colombia require a valid visa. Common options include:
| Visa Type | Purpose | Duration |
|---|---|---|
| M-5 Work Visa | For contracted employees. | Up to 3 years. |
| M-11 Business Visa | For business visits. | Up to 180 days per year. |
| R Permanent Visa | For long-term residents. | Indefinite. |
An EOR streamlines the visa process by handling compliance requirements for foreign workers.
Related topics
Frequently Asked Questions (FAQ)
Can I hire independent contractors in Colombia?
Yes, but misclassifying employees as contractors can result in penalties. An EOR ensures correct classification.
What taxes do employers pay in Colombia?
Employers contribute to social security, health insurance, labor risks, and parafiscales, totaling approximately 30% of the employee’s salary.
How long does it take to hire with an EOR in Colombia?
An EOR can onboard employees within days, compared to months for setting up a legal entity.
Get Started with an Employer of Record in Colombia
Hiring in Colombia can seem complex, but an Employer of Record (EOR) simplifies the process. Europortage handles employment contracts, payroll, benefits, and compliance, letting you focus on growth.
Ready to expand your team in Colombia? Contact us today to learn more about how we can support your business expansion.
