How to hire remote employees in

Colombia

Found someone in Colombia you’d like to hire? Maybe a little confused about how to hire them? You’re in the right place. On this page, you’ll learn about how to hire talent in Colombia—without spending months and thousands of dollars getting set up.

Book demo

Employment requirements

Country snapshot

CURRENCY

Colombian Peso (COP)

EMPLOYER TAXES

25% - 30%

PAYROLL FREQUENCY

Bi-Weekly/Monthly

OFFICIAL LANGUAGE

Spanish

Why hire independent contractors in Colombia

Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in Colombia.

It’s the fastest way to hire globally

Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.

It’s a lot cheaper

It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.

It’s more flexible for you & your team

HHiring contractors in Colombia means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.

Can be less risky than hiring employees

Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.

Some people want to be employees

The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.

You might not have as much control over your talent

Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.

What to know before you hire in Colombia

Found some great remote talent in Colombia, but slightly more confused about how to hire that talent? Well, you’ve got two options: Hiring talent as employees, or hiring talent as contractors. Here are the big differences between the two.

If you want to successfully hire in Colombia, you have two options:

Hire talent as contractors

Laws about hiring contractors are significantly more simple in Colombia. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Thera for.

Hire talent as employees

This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in Colombia is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.

Hire contractors in a couple clicks with Thera

How can I pay people in Colombia

If you’re hiring contractors in Colombia, you can pay them with Thera in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.

If you want to hire employees in Colombia

If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Colombia than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Colombia.

Taxes in Colombia

Employer tax

Pension Fund

Medical Plan

Labor Risks

Family Compensation Funds

Family Welfare (ICBF)

National Apprenticeship Service (SENA)

Note: Only applies to employees earning 10 times the minimum wage

Leave

Paid Time Off (PTO)

PTO is calculated by the:

Employees are entitled to 15 paid days of annual leave.

Public Holidays

There are 18 public holidays.

Sick Days

The employer is responsible for paying for the first 2 days of sick leave at the rate of two-thirds of the regular salary.

From the third day on, sick leave is paid by social security at the same rate.

Maternity Leave

Maternity leave is 18 weeks, paid at a rate of 100% salary. The employer makes the payment to the employee and then claims the money back through social security (EPS).

Paternity Leave

Paternity leave is 8 working days, paid at a rate of 100% salary. The employer makes the payment to the employee and then claims the money back through EPS.

Parental Leave

There are no provisions in the law regarding parental leave.

Other Leave

None.

Marriage Leave

5 days of paid leave.

Bereavement Leave

5 days. Leave can be paid or unpaid and depends on company policy.

Termination

Termination Process

The reason for dismissal must be communicated to the employee in writing upon termination.

If the termination is initiated by the employer, it is not mandatory for the employer to give a reason for termination unless there is an allegation of an unfair cause.
For pregnant or disabled employees- the employer must get special permission to terminate the employee.
For unionized employees- the employer must get permission from a labor judge in order to terminate an employee.
If the employee terminates the employment contract due to a breach by the employer, they are entitled to severance payment.

Notice Period

The notice period in Colombia is:

When the employee is dismissed for poor performance, a maximum of 15 days’ notice must be given. The employee is entitled to at least 24 hours to review the dismissal notification and respond.
In the case of misconduct or dismissal with a just cause, no notice is required.
For employees with a fixed-term agreement, written notice is required at least 30 days prior to the agreement’s expiration.

Severance Pay

The Severance Pay in Colombia depends on the Duration of Employment:

When the termination is without cause, employers are obligated to pay severance. For employees with an indefinite term agreement, the severance will be calculated as follows:

Employees earning less than 10 minimum legal monthly wages are entitled to 30 days of wages for the first year of service and 20 days of salary for each additional year of service.
Employees earning 10 minimum legal wages or more, will be entitled to 20 days of salary for the first year of service and 15 days of salary for each additional year of service.
For employees with a fixed-term agreement, the severance would be equal to the salary of the employee until the term of the agreement expires.

Probation Period

Indefinite contracts- The probation period is 2 months.

Fixed-term contracts- The probation period cannot exceed more than 1/5 of the initially agreed employment term.

Employee requirements in Colombia

Working Hours

Full-time employment is considered 48 hours weekly, and 8 hours daily.

Hours worked in a single day cannot exceed 10.

Overtime

Overtime pay rates are as follows:

Daytime Overtime – 125% of the regular pay rate
Night Overtime – 175% of the regular pay rate
Sunday/Holiday Extra Daytime – 175% of the regular pay for holidays and 125% of the regular pay for work during the daytime
Sunday/Holiday Overtime – 175% of the regular pay for holidays and work during the night.

Exemptions on overtime compensation:

Employees who earn more than 10 times the minimum wage
Employees in trust positions- this title must be mandated in the employment contract, and an employee with this position is entitled to night and Sunday overtime only.

Run your global workforce on autopilot with Thera

Book a demo to get started.

Get started