Table of Contents
Employer of record EOR in Colombia
With 10 million people living in its metropolitan area alone and coastal mountains reaching more than 18,000 feet above sea level, beautiful Colombia in South America is the highest city (in terms of altitude) with that many people in the world. Traffic can be heavy, and business is directed from above, even more than usual.
Colombia is one region of the world where being invited to a bullfight by a fellow bullfighter is a great honor, not a suggestion. To navigate this place, an EOR at your side can help you manage the employment process, HR logistics and much more to ensure your company makes a good impression and succeeds in these mountainous cities by the sea. Hiring SERVIAP as Employer of Record for Colombia means bringing experts on board to handle all these issues for you.
SERVIAP can help you with your global expansion needs. Contact us today to find out how you can expand your business with an Employer of Record in Colombia.
What is a registered employer?
An EOR or Employment of Record will become an employer rather than a company so that you can assume the responsibilities and obligations that would otherwise fall on your business. This works well for expanding companies, as they often don’t know the ins and outs of having a business in each country. Hiring an EOR gives them room to expand more advantageously, so they can hire more employees and start the circle all over again.
An EOR will be in charge of payroll, compliance with the country’s laws, timekeeping, possible unemployment claims, benefits to be paid and given, workers’ compensation in case of accident and other things, and much more. You can also partner with a PEO, which is similar: they help you with taxes, benefits and human resources.
SERVIAP functions as PEO and EOR, assisting you in the most efficient way possible, so that you can relinquish responsibilities for much of the employee operations. When you hire a company like us, we assume responsibility for any of the above services and take care of in-country subsidiaries that might otherwise fine you or slow down your operations. All you have to do is relinquish the responsibilities and lease back to your employees (while retaining full control over your workforce).
SERVIAP acts as the client’s Employer of Record (EOR), managing everything related to human resources and freeing the client to focus on business growth and expansion into new markets.
Tasks SERVIAP specializes in may include:
- Payroll
- Benefits
- Tax Filing
- Compliance
- Workers’ compensation (if applicable)
- Timing
- Unemployment benefit claims
- Global sourcing
- Talent acquisition (recruitment)
- Global HR management
How to start contracting in Colombia
The most important document you should know is the Colombian Labor Code. It details what your company needs to know about how to hire employees, what benefits they are entitled to and what their obligations are.
Another comprehensive source of information is the documentation published by the Colombian Ministry of Labor, which includes local labor court rulings. Since 1990, the labor law known as Law 50 has changed the operation of employment in Colombia, including the elimination of government responsibility for unemployment benefits. This means that if your employees can prove that they were wrongfully terminated, your company could be liable for the cost of their lost benefits.
This is just one of the important reasons why an EOR is critical to the success of your business in Colombia. You need someone on your side who knows the local laws and can ensure that your company maintains a good standing with the local labor authorities.
Employment contracts
Employment contracts are not required by any labor ministry in Colombia. However, the transparency they provide between your company and employees will help your company keep the relationship on your terms. Probationary periods and the duration of contracts for fixed-term employees must be listed in these contracts, as well as benefits and other logistical aspects. Contracts must be in Spanish and English and remuneration must be stated in pesos.
Please note that the Colombian government and labor ministry do not recognize many types of employment that would be contractual options for your company in other countries. Contracts of limited or unlimited duration may be filed under the same local laws. Navigating the limited options to find the best terms for your company’s objectives is one of the many advantages of hiring an EOR to handle employment contracts.
Incorporation of employees
Employee onboarding can take place in person or online. It should be noted that in Colombia there are many important unions that have real power to change the terms of an employee’s contract during the hiring process.
These unions will be especially present for manufacturing or other companies that intend to hire many workers in Colombia at one time. Aggressive representation of large groups of workers is very common in this country.
In the case of individual employees, negotiations tend to be less pressured, especially in the case of younger jobs. However, the more senior an employee is, the more demanding the candidates will be. Negotiating these conditions requires a working knowledge of Colombia’s negotiating tactics and union policies, which an EOR can offer your company.
Employee benefits and paid leave
Employees work 48 hours per week in Colombia, typically Monday through Friday, for an average of 9.6 hours per day. Some contracts specify 8-hour workdays for 6 days a week. However, a new 2021 law is phasing in rules limiting the workweek to 42 hours, so be prepared for that change in the coming years.
Overtime is paid at 1.25 times the normal salary, while overtime on public holidays is 1.75 times. There are 18 holidays that companies must take into account in Colombia, including many religious observances and working days. Employees also receive 15 vacation days with full pay and two sick days at 2/3 of their normal salary. After that, sick days up to 180 are paid through social security.
Expectant mothers receive 14 weeks of maternity leave with full pay, while fathers receive 2 weeks of paternity leave. Colombia’s universal health care system entitles all employees to a package of health benefits as part of the Contributive or Subsidized Regime.
Partner with the SERVIAP Group as your employer in Colombia.
SERVIAP is a leading Employer of Record (EOR) ready to help your company expand its operations worldwide. EOR is a co-employment model, where we take full responsibility for your talent, allowing you to focus on the strategic activities of your organization.
Contact us today to learn more about how you can expand your business with a registered employer in Colombia.
