How to stay compliant

Employer-of-Record (EOR) in Colombia: Do You Need One?

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Aenean faucibus nibh et justo cursus id rutrum lorem imperdiet. Nunc ut sem vitae risus tristique posuere.

How to stay compliant

Employer-of-Record (EOR) in Colombia: Do You Need One?

So you want to hire someone in Colombia. Problem is, your company is located somewhere else.  

If you’ve done some research, you’ve probably been told you should be using an Employer-of-Record (EOR). Why? Well, if your company isn’t located in Colombia, using an EOR can help you bypass the traditional obstacles to hiring full-time employees.  

But there’s a catch: EOR solutions in Colombia are expensive—usually at least $500 per month per employee—and can take time to set up. And because you’re complying with a different set of labor laws, logistics and benefits can end up costing you lots of time and money. While they will save you time from setting up your own entity, they’re rarely cheap or fast.

The good news? There’s another way to hire remote workers in Colombia, and it doesn’t involve forking out huge amounts of money for an EOR.  

The solution: Hire your teammates in Colombia as contractors. If you’re hiring remotely and your teammates have autonomy, there’s a good chance you can make compliant contractor hires. You still have to use locally-compliant contracts, but the process is a lot easier, more affordable, and faster.

We built Thera to help you make contractor hires, in 150+ countries (like Colombia). So you can hire the people you want on your team, without paying thousands for an EOR. You can get set up in a couple of clicks—and you’ll only pay $49 per contractor per month.  

It’s just as easy as it sounds. No catch. Here’s what Thera looks like vs. an EOR in Colombia:

Everything you should know about using an EOR in Colombia

Are you a business owner or manager considering hiring independent contractors in Colombia? Before you make any decisions, it's important to understand the legal and regulatory conditions specific to the country. In this post, we'll break down everything you should know about using an EOR in Colombia, and why hiring an independent contractor might be easier.

What is an EOR?

An EOR, or Employer of Record, is a third-party company that acts as the employer for your workers in a foreign country. This means that the EOR takes care of all the legal and administrative tasks related to employment, such as payroll, taxes, and benefits. By using an EOR, you can avoid the complexities of setting up a legal entity in a foreign country and ensure compliance with local laws and regulations.

Legal and regulatory conditions in Colombia

Colombia has a complex labor law system that can be challenging for foreign employers to navigate. Some of the key regulations to be aware of include:

- Minimum wage: The minimum wage in Colombia is set annually by the government and varies depending on the type of work and the region of the country.

- Social security: Employers in Colombia are required to contribute to the social security system, which covers health insurance, pensions, and other benefits.

- Labor contracts: All employees in Colombia must have a written labor contract that outlines the terms and conditions of their employment.

- Termination: Terminating an employee in Colombia can be difficult and expensive, as there are strict rules around severance pay and notice periods.

Why hiring an independent contractor might be easier

Given the complex legal and regulatory conditions in Colombia, hiring an independent contractor might be a simpler option for some employers. Independent contractors are not subject to the same labor laws and regulations as employees, which means that employers have more flexibility in terms of their work arrangements.

What if I accidentally misclassify my contractors?

We’ve got two pieces of good news for you. For one, if you’re hiring remotely, it’s unlikely you’ll misclassify your contractors. Many of the things that qualify people as employees, such as company equipment and set working hours, don’t typically apply to remote work.

Still, it’s helpful to have the comfort of knowing you’re not at risk for misclassification. That’s why, at Thera, we’ve launched Misclassification Assurance: so you can hire contractors abroad, worry-free. Learn more about hiring with Thera below.

Hiring contractors? Thera can save you a ton of time

If you’re hiring contractors, you’re probably spending too much time on their payroll, contracts, and tax documents. Which is why we built Thera, which saves you 90% the time you spend on contractor paperwork each month.

With Thera, you can compliantly hire your contractors in 150+ countries, onboard them in minutes, and pay them all at once (in a click). It’s global contractor payroll, finally simplified.

Sound interesting? Click here to book a demo and see the platform firsthand

Run your global workforce on autopilot with Thera

Book a demo to get started.