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Colombia Employment & Payroll Guide: Employment Laws, Payroll & Taxes

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Key Law Terms Overview in Colombia

In Colombia, employers are legally required to report and remit social security contributions, parafiscal levies, and payroll taxes for all employees through the Integrated Payroll System (PILA – Planilla Integrada de Liquidación de Aportes). This system centralizes employee registration, contribution calculation, and payment to relevant authorities.

Key points:

  • All dependent employees must be registered in PILA from their first day of employment.

  • Contributions include health insurance (EPS), pension (AFP), occupational risk insurance (ARL), and family welfare funds.

  • Employers must calculate contributions based on the employee’s wage base, deduct employee contributions, and remit both employer and employee portions on a monthly basis.

  • PILA also serves as the official reporting channel for certain income tax withholdings at source.

  • Non-compliance can result in fines, interest, and penalties imposed by the Colombian tax authority and social security regulators.

Official Reference:

Disclaimer: This content is provided for general informational purposes only and does not constitute legal advice.

Colombia’s Código Sustantivo del Trabajo is the primary legal framework regulating employment relationships. It establishes the rights and obligations of employers and employees, forming the foundation for compliant hiring through an Employer of Record (EOR).

While the law contains hundreds of articles, the main provisions cover:

  • Employment Contracts & Hiring
    Defines contract types (indefinite-term, fixed-term, work-for-task), essential elements, probation periods, and requirements for written agreements.

  • Wages & Compensation
    Establishes minimum wage, allowable allowances, overtime pay, night work premiums, and rules for timely payment of salaries.

  • Working Hours & Overtime
    Sets standard weekly working hours, maximum limits, rest periods, and overtime calculation rules.

  • Leave & Benefits
    Regulates annual paid vacation, public holidays, sick leave, maternity and paternity leave, and other statutory benefits.

  • Social Security & Mandatory Contributions
    Requires registration and payment to health insurance, pension, occupational risk insurance, and family welfare funds.

  • Termination, Notice & Severance
    Details lawful termination procedures, required notice periods, severance calculations, and settlement of outstanding benefits.

  • Collective Bargaining & Union Rights
    Protects the rights of employees to organize, join unions, and engage in collective bargaining.

  • Workplace Protections & Anti-Discrimination
    Covers equal treatment, anti-harassment measures, and protections for vulnerable employees.

  • Special Labor Regulations
    Includes provisions for minors, apprentices, domestic workers, and other specific labor categories.

For the complete text and all articles, refer to the official government sources:

Disclaimer: This content is provided for general informational purposes only and does not constitute legal advice.

In Colombia, both employers and employees are required to participate in the Sistema General de Seguridad Social Integral (General Social Security System), which covers health insurance (salud), pension (pensiones), and occupational risk insurance (ARL). The legal framework is established through key national laws, primarily Ley 100 de 1993 and supporting legislation.

🔹 Ley 100 de 1993 – Social Security System Framework

Purpose:
Law 100 of 1993 establishes the integrated social security system, which includes mandatory contributions to health, pension, and risk insurance for all workers who have an employment contract. This law defines the structure of the system and the obligations of employers and employees.

Key provisions:

  • The social security system is composed of health, pension, and occupational risk programs that provide coverage for work‑related contingencies and social protection.

  • Affiliation to the social security system is obligatory for all dependent employees.

  • Employers must ensure workers are registered with the relevant social security entities and that contributions are made timely according to legal requirements.

  • Employers who fail to register workers or prevent their affiliation can face sanctions, including fines ranging from one minimum monthly wage up to 50 times that wage.

👉 Official full text of Ley 100 de 1993 (Spanish)
🔗 https://www.minsalud.gov.co/sites/rid/Lists/BibliotecaDigital/RIDE/DE/DIJ/ley-100-de-1993.pdf

Disclaimer: This content is provided for general informational purposes only and does not constitute legal advice.

In Colombia, employers are legally required to report and remit social security contributions, parafiscal levies, and payroll taxes for all employees through the Integrated Payroll System (PILA – Planilla Integrada de Liquidación de Aportes). This system centralizes employee registration, contribution calculation, and payment to relevant authorities.

Key points:

  • All dependent employees must be registered in PILA from their first day of employment.

  • Contributions include health insurance (EPS), pension (AFP), occupational risk insurance (ARL), and family welfare funds.

  • Employers must calculate contributions based on the employee’s wage base, deduct employee contributions, and remit both employer and employee portions on a monthly basis.

  • PILA also serves as the official reporting channel for certain income tax withholdings at source.

  • Non-compliance can result in fines, interest, and penalties imposed by the Colombian tax authority and social security regulators.

Official Reference:

Disclaimer: This content is provided for general informational purposes only and does not constitute legal advice.

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Regulation Updates in Colombia

Discover the latest employment and compliance updates in Colombia — helping you stay ahead in a changing regulatory landscape.

Decree No. 223 of 2026 - Regulation of Labor Practicums and the Apprenticeship Contract

What it is: Decree No. 223 of 2026 establishes new obligations for labor practicums and the Apprenticeship Contract, replacing the relevant chapter of Decree 1072/2015.

What it changes: The decree introduces mandatory social security affiliation and specifies that the base for contributions is the minimum wage, affecting employers’ social contributions and payroll responsibilities.

Who is affected:

  • Employers
  • Labor practicum participants

What employers should do:

  • Ensure compliance with social security affiliation requirements for labor practicums and the Apprenticeship Contract.
  • Align payroll processes to use the minimum wage as the base for social contributions.

Notes: Effective month: 2026-05. Manual verification recommended.

What it is: Policy update clarifying documentation requirements for temporary foreign workers under the Temporary Worker’s Visa.

What it changes: The Ministry of Foreign Affairs page now specifies that authenticated contract summaries and recent corporate existence certificates are required for applicants and employers, altering employer obligations when sponsoring foreign workers and affecting work permits.

Who is affected:

  • Employers sponsoring foreign workers
  • Applicants for the Temporary Worker’s Visa

What employers should do:

  • Ensure compliance with the clarified documentation requirements, including authenticated contract summaries and recent corporate existence certificates when sponsoring foreign workers.

Notes: Effective month: 2026-05. Manual verification recommended.

What it is: A Joint Circular requiring operators, contractors and employers to prioritize hiring Certified Electrical Technicians in Renewable Energy Projects and to ensure affiliation to the social security system.

What it changes: It introduces obligations for hiring with priority given to Certified Electrical Technicians and requires verification of social security affiliation for workers.

Who is affected:

  • Operators
  • Contractors
  • Employers

What employers should do:

  • Prioritize hiring Certified Electrical Technicians in relevant projects.
  • Verify that workers are affiliated to the social security system.

Notes: Effective month: 2026-04. Manual verification recommended.

What it is: Resolution 1747 of 22 April 2026 extends the application deadline for the Permiso Especial de Permanencia (PEP Tutor).

What it changes: The extension keeps the original requirements in place and broadens eligibility for the document that allows holders to remain and undertake employment.

Who is affected:

  • Workers who may apply for the Permiso Especial de Permanencia (PEP Tutor)
  • Employers and EORs/payroll providers involved in hiring or employing such workers

What employers should do:

  • Update hiring and onboarding processes to account for the extended PEP Tutor eligibility window
  • Ensure payroll and employment eligibility considerations reflect the extended deadline for PEP Tutor holders

Notes: Effective month: 2026-04. Manual verification recommended.

What it is: An order from the Council of State denying requests to lift the provisional suspension and maintaining the suspension of Decree 1469 of 2025.

What it changes: The provisional suspension of Decree 1469 of 2025 remains in effect as of 2026-04, and the decree continues to be suspended. This affects the setting of the 2026 minimum wage as referenced by the decree.

Who is affected:

  • Employers

What employers should do:

  • Consider payroll and wage obligations in light of the continued suspension of Decree 1469 of 2025.

Notes: Effective month: 2026-04. Manual verification recommended.

What it is: Decree 0234 of 2026 on collective bargaining by levels allows collective bargaining to be conducted at levels above the individual company, such as by sector, branch, or group of employers.

What it changes: The decree enables collective bargaining at higher organizational levels and may require employers across a sector to implement agreed terms.

Who is affected:

  • Employers across a sector or sector-wide group of employers
  • Potentially individual companies within those sectors

What employers should do:

  • Monitor sector-level bargaining developments
  • Prepare to align with any sector-level terms if and when implemented

Notes: Effective month: 2026-03. Manual verification recommended.