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Capital City
Bogota
Currency
Colombian Peso
(
$
)
Timezone
GMT -5
Payroll Frequency
monthly
Tax Year
1 January - 31 December
Employer Tax
0% - 39%
Languages
Spanish
Capital City
Bogota
Currency
Colombian Peso
(
$
)
Timezone
GMT -5
Payroll Frequency
monthly
Tax Year
1 January - 31 December
Employer Tax
0% - 39%
Languages
Spanish
Minimum Wage: The statutory minimum wage in Colombia is COP 1,423,500 per month, reflecting a 9.54% increase from the previous year.
Working Hours: Employees are typically expected to work up to 48 hours in a standard week, which is equivalent to eight hours per day in a six-day work week.
Payroll Taxes: In Colombia, employers are required to make payroll contributions that fund social security, health care, and other statutory employee benefits.
Average Salary: The average salary in Colombia is approximately 4,690,000 COP (around USD 1,060).
Hiring independent contractors has boomed in popularity because of the cost savings and flexibility they offer. It can be a great option if you require niche skills or short-term project support. Contractors allow businesses to access specialized skills quickly, without the time and cost of setting up a local entity.
However, it’s important to know the limits of this model: contractors are not a substitute for full-time employees. Relying on them for ongoing, long-term roles can create serious compliance risks, including employee misclassification, which can lead to fines, back taxes, and reputational damage.
Playroll’s contractor management solutions make it simple to compliantly engage, onboard, and pay contractors around the world. We provide clear visibility into agreements, streamline payments, and reduce compliance risks – so you can focus on getting the work done. And when you’re ready to take the next step, we can help seamlessly convert contractors into full-time employees through our global Employer of Record service.
From compliant contracts to competitive benefits, Playroll’s EOR services keep you aligned with local labor laws and regulations, safeguarding your business, so you can focus on growth.
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Businesses can only operate smoothly in Colombia if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Colombia below, to avoid any compliance issues.
In Colombia, it's advisable to create a written employment contract when hiring a new employee. Colombian labor law distinguishes between permanent and fixed-term contracts, with the latter needing written documentation and a maximum duration of three years. The contract should include details such as job description, salary, benefits, total holidays, and any probationary period.
We can help you get a new employee started in Colombia quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations. For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.
Employees are typically expected to work up to 48 hours in a standard week, which is equivalent to eight hours per day in a six-day workweek. They are entitled to one day off each week, usually on Sunday, but they can choose an alternate day off if specified in their employment contract, providing flexibility.
Overtime work should not exceed two hours per day or a total of twelve hours per week. Compensation for overtime must be at a minimum rate of 125% for daytime work and 175% for work during nighttime or on public holidays.
Probationary periods are optional but should not exceed 60 days from the date of employment.
In 2025, the average monthly salary in Colombia is approximately 4,690,000 COP (around USD 1,060). Salaries vary significantly depending on experience, industry, and location - professionals with several years of experience can earn 30–70% more than entry-level workers, while sectors like technology, finance, and healthcare tend to offer above-average wages. Geographically, urban centers like Bogotá and Medellín report higher salaries compared to rural areas. Colombia's economic environment in 2025 features moderate inflation (~5%), steady economic growth, and an unemployment rate near 8.8%, all of which contribute to a cautious upward trend in wages.
In 2025, Colombia's national minimum wage stands at COP 1,423,500 per month, with an additional transportation allowance (at COP $200,000). Employers should consider economic conditions, industry variations, and legal requirements to ensure compliance and fair compensation.
Employers in Colombia must remain aware of annual minimum wage updates to ensure compliance and fair compensation practices. The 2025 minimum wage increase reflects an effort to counter inflation and support workers' financial stability. While the minimum wage serves as a baseline, businesses should also evaluate the cost of living and industry-specific salary trends to remain competitive and retain skilled employees.
Hiring in Colombia means navigating local labor laws, mandatory employee benefits, payroll taxes, and strict employment regulations. These requirements aren’t always intuitive, especially if your team lacks in-country legal or HR expertise. An Employer of Record steps in as the legal employer for your hires, managing all compliance-related responsibilities. This includes issuing locally compliant contracts, registering employees with relevant authorities, processing payroll, and handling social security contributions and taxes in line with national laws.
By handing over these complexities to an EOR, your business avoids costly compliance errors and the time required to master local employment standards. You can focus on growing your team and operations while trusting that the legal and administrative foundation is solid. Whether you're making one strategic hire or building out an entire team, the EOR keeps you compliant, removes guesswork, and reduces the risk of legal or financial penalties, without requiring you to open a legal entity or maintain a local HR team.
1 January - 31 December is the 12-month accounting period that businesses in Colombia use for financial and tax reporting purposes.
The payroll cycle in Colombia is usually monthly, with employees being paid by the last working day of the month. Some industries also follow a bi-weekly schedule, with payments on the 15th and the last working day.
In Colombia, employees are legally entitled to a 13th-month salary.
Employer payroll contributions are generally estimated at an additional 0% - 39% on top of the employee salary in Colombia.
In Colombia , the typical estimation for employee payroll contributions cost is around 8%-9%.
In Colombia, employee income is taxed in "units. One tax unit is equal to 49,799 COP.
Colombian workers and their employers are required to make regular contributions to the pension system. These contributions are deducted from employees' salaries and matched by their employers. The pension benefits in Colombia are calculated based on the average salary and the number of weeks or months of contributions. The formula takes into account the individual's average earnings over their career and the number of weeks or months contributed. The more one contributes and the higher their average salary, the larger their pension benefits will be.
Employers in Colombia must navigate a variety of payroll obligations, including contributions to health insurance, pension funds, and labor risk insurance, along with compliance around income tax withholding and parafiscal payments. Understanding these components is essential to maintaining compliance and managing labor costs.
Leveraging payroll management software can help employers consolidate payroll data and stay compliant in Colombia.
Running payroll in Colombia is complex, especially when you're hiring without a local entity. Local laws determine everything from tax withholdings and reporting deadlines to benefit contributions and currency requirements. Missteps can lead to fines, payment delays, or unhappy employees. An Employer of Record takes this burden off your plate by handling the full payroll process. Acting as the legal employer, the EOR ensures you remain compliant with all payroll-related obligations, while still allowing you to manage your team’s day-to-day work and performance.
Key Ways an EOR Supports Payroll in Colombia:
Make better business decisions by consolidating global payroll data, while seamlessly syncing your existing payroll operations.
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In Colombia, work permits and visas are essential for employers hiring foreign workers. The process involves submitting applications, paying fees, and meeting specific eligibility criteria. The key visa types include the M Visa for employment, the V Visa for short-term work, and the R Visa for permanent residency. Employers must ensure compliance with local labor regulations when sponsoring foreign employees.
The annual leave entitlement in Colombia is 15 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.
Colombia has 18 mandatory national public holidays in a year
Paid leave in Colombia is outlined in the employment contract as a minimum of 15 days paid leave a year, following completion of 1-year service
Female employees can take 18 weeks of fully paid maternity leave which can start up to two weeks before birth.
Fathers of newborn children can take 2 weeks of paternity leave.
Every employee is eligible for paid sick leave provided by their employer for the initial two days of leave, equivalent to 100% of their regular pay rate.
In Colombia, there isn't a distinct "parental leave" policy separate from maternity and paternity leave. However, the country has implemented provisions that allow parents to share a portion of the maternity leave. Specifically, mothers can transfer up to six weeks of their 18-week maternity leave to the father, enabling shared caregiving responsibilities.
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Administering employee benefits in Colombia requires more than just offering a standard package. Local labor laws often mandate specific entitlements, from health insurance to paid leave, and the rules can change without warning. Colombia also has unique standards for what an attractive, competitive benefits package looks like. For businesses without in-country expertise, meeting these obligations and expectations can quickly become risky and expensive. An Employer of Record acts as your compliance partner, ensuring all benefits are provided according to the latest legal requirements and without administrative strain on your internal team.
Beyond compliance, an EOR brings clarity and consistency to a process that’s often complex and fragmented. They handle enrollments, ensure accurate employer contributions, manage communications with local providers, and keep everything properly documented. This means employees get what they’re entitled to, and you avoid the headache of navigating benefits systems in a foreign market. Whether you're hiring one person or building a larger team, an EOR provides a clear, dependable structure that lets you offer competitive benefits without taking on unnecessary risk or workload.
In Colombia, termination procedures typically adhere to labour laws, unless there are valid reasons for immediate dismissal. Written notice of termination is required and must be sent to the relevant government authorities. Any outstanding payments to departing employees should be settled on their last workday. In Colombia, termination procedures typically adhere to labor laws, unless there are valid reasons for immediate dismissal, like gross misconduct. Written notice of termination is required and must be sent to the relevant government authorities. Any outstanding payments to departing employees should be settled on their last workday. Valid reasons for dismissal include:
Employers are only required to give notice to employees when a fixed-term contract is ending without an extension, which has a 30-day notice period. During the first five years of employment, a 30-day notice is mandatory, and it extends to 90 days for employees with more than five years of service.
Severance pay is required if the employee is dismissed without cause .
Disclaimer
THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). Playroll does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect Playroll’s product delivery in any given jurisdiction. Playroll makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.
ABOUT THE AUTHOR
Jesse Weisz
Jesse is an experienced R&D Analyst at Playroll, a leading Employer of Record (EOR) provider. With a strong background in data analysis and market research, Jesse specializes in identifying emerging trends and driving innovation in global HR solutions. She is an all-rounder, critical thinker and success-seeker (often inextricably linked to being a late-night tea drinker).
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Standard employment terms in Colombia include working hours, leave entitlements, and conditions outlined in employment contracts, governed by labor laws and regulations.
As of January 1, 2025, Colombia's national minimum wage has been set at COP 1,423,500 per month, reflecting a 9.54% increase from the previous year. In addition to the base salary, employees are entitled to a transportation allowance of COP 200,000 per month, bringing the total minimum compensation to COP 1,623,500 monthly. This adjustment aims to enhance workers' purchasing power and address inflationary pressures.
The average salary in Colombia in 2025 is about 4.69 million COP per month, with higher wages typically found in major cities and among experienced professionals.
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