Employer of Record in Colombia (Hiring and Payroll Guide)

An Employer of Record (EOR) can sign the local employment contract and run payroll where the arrangement fits Colombian law. Start with who will direct the employee's work and how long you need the role. If your company wants to supervise someone assigned by a third party, Colombia limits that staffing route to specific temporary needs. A continuing role under your supervision calls for a direct-employment plan. Temporary staffing law · Labor reform

Employment in Colombia at a glance

National baseline for private-sector employees in Colombia under ordinary employment terms. Special schedules, sector rules and collective agreements can change individual terms. Sources checked 9 November 2026.

EOR and hiring options

In Colombia, an authorized temporary services company (empresa de servicios temporales, or EST) can employ and assign workers for a qualifying temporary need. The permitted cases include absence cover for the duration of the absence, occasional work outside the employer's normal activities for up to one month, and qualifying peaks such as a temporary rise in sales or service demand for up to six months, with a possible extension of up to six more. The assignment contract must identify the specific reason. Once the permitted term or condition ends, changing agencies cannot extend staffing for the same continuing need. A court can recognize the client as the actual employer if the statutory limits are breached. Law 50, arts. 71 to 82 · Labor reform, art. 45

Covering a leave or filling a permanent seat? An authorized EST may cover an analyst's documented parental leave until the employee returns. If the same analyst role is an ongoing seat on your team and your managers will set the hours, assign the daily work and supervise performance, plan to employ the analyst directly. Temporary staffing law · Outsourcing decree

If you need a defined service, such as a monthly reporting package, a genuine outsourcing supplier can deliver it with its own organization, staff supervision and business risk. An individual contractor also needs real independence in how they do the work. Under Decree 581, outsourcing permanent activities raises a rebuttable presumption of employment with the client. The client can also share liability for wages, benefits and indemnities when outsourced work relates to its ordinary business. Labor Code, arts. 23 to 35 · Outsourcing decree

For a qualifying placement, verify the Ministry of Labor authorization of the company that actually employs and assigns the worker. The EST pays wages and benefits and handles social security. The client supplies the pay scale for comparable work where one applies, and assigned workers are entitled to equivalent ordinary pay and relevant on-site transport, food and recreation benefits. The client also has workplace safety duties, including induction and protection where the assignment is performed on its site. For direct employment through your Colombian entity, you can outsource payroll processing while keeping the employer role. Assess corporate tax exposure separately if the worker will negotiate or sign contracts for the foreign business. Law 50, arts. 78 to 81 · Workplace safety rules · Tax Statute, art. 20-1

Employment costs

For a full-time, daytime office analyst in Bogotá earning COP 6 million gross per month, allow about COP 8.05 million to COP 8.86 million per month as a statutory payroll budgeting equivalent, before any service fee. This Borderless AI illustration applies November 2026 rates to 12 regular payroll months, with fixed ordinary pay, a class I occupational-risk rate and no shift premiums or transport allowance. A quote for an eligible staffing assignment will also depend on its actual duration, comparable pay and the agency's fee.

The exemption depends on the legal employer's tax status and the employee earning less than 10 minimum monthly wages, or COP 17,509,050 in 2026. Ask the named employer which case applies. The annual base includes ordinary vacation pay. Actual remittances can change with paid leave or other payroll adjustments. Price equipment and the entry medical assessment, supplemental benefits, applicable shift premiums and exit costs separately. Employer contribution rates · Contribution bases · ARL rates · Tax Statute, art. 114-1

A written salario integral agreement changes the calculation for higher earners. Its statutory floor is at least 13 minimum monthly wages, or COP 22,761,765 in 2026. It can include statutory bonuses, cesantías and certain premiums in the agreed salary. Vacation remains separate from the items the agreement can absorb, and contributions generally start from 70% of the integral salary, subject to the applicable limits. Confirm whether an offer is ordinary or integral before comparing annual totals. Labor Code, art. 132 · UGPP integral salary guide

Payroll and payment dates

Agree a salary schedule such as monthly or twice monthly. The employer deducts the employee's standard 4% health and 4% pension contributions from gross pay and withholds income tax where due. An additional employee solidarity pension contribution starts at four minimum monthly wages. Labor Code, art. 134 · Pension law, arts. 18 to 20 · Tax Statute, art. 383

For standard full-time employment, the health, pension and occupational risk contribution bases generally run from one to 25 minimum monthly wages. Payroll levies have their own base. The employer remits contributions monthly through PILA, Colombia's integrated payment system. The last two digits of its tax ID determine the due date, from the second to the sixteenth business day. UGPP employer guide · PILA calendar

Reserve for four payments around the regular payroll cycle. Under the standard annual method, the employer pays the worker two prima de servicios installments and cesantías interest, and deposits the cesantías principal into the employee's chosen fund. For the COP 6 million example and a full calendar year of continuing employment, that means the following. Prima rules · Cesantías rules, art. 99 · Interest deadline

That puts COP 6.72 million of the year's benefit accruals into the following January and February. Keep those payments in the cash forecast even after the salary year closes. Ask which month each item appears on the provider's invoice. The law allows a written agreement to pay cesantías interest monthly, and provides for an optional advance fund deposit mechanism through PILA. Confirm the payment method and its operational availability with payroll. The Constitutional Court has set 1 April 2027 for the pension-system provisions it upheld. Recheck the applicable contribution and remittance rules for payroll running into that period. Labor reform, art. 64 · Pension ruling

Contracts and remote work

An indefinite contract is the default. A fixed-term contract must be in writing and can run for up to four years, including renewals. A contract for a defined project or task must also be in writing and describe the work precisely. Agree any probation in writing. It can last up to two months, or one fifth of the initial term for a fixed term shorter than one year, subject to the same two-month cap. Check any applicable collective agreement before finalizing pay, hours and benefits. Labor reform, arts. 5 to 6 · Labor Code, arts. 76 to 80 and 467 to 478

Agree the work location, schedule, equipment and expense arrangements in the offer. Colombia distinguishes regular telework, temporary work from home and employment performed entirely remotely. The category affects equipment, connectivity and occupational-risk administration. Use the employee's actual work address when setting up coverage, and agree how moves and after-hours work will be handled. Telework rules · Temporary work from home · Fully remote work

Working hours, leave and holidays

Plan on a maximum ordinary week of 42 hours, usually with an eight-hour daily limit. An agreed flexible schedule can allow up to nine hours in a day within the weekly limit and the statutory conditions. Check special regimes for roles such as security or health care. Labor reform, arts. 10 to 14

In the general regime, ordinary night hours from 7 p.m. to 6 a.m. carry a 35% premium. Daytime overtime carries a 25% premium and nighttime overtime 75%. An evening support shift can add a premium even when the weekly total stays below 42 hours. Work on a statutory holiday or weekly rest day carries a 90% surcharge from 1 July 2026, rising to 100% on 1 July 2027. Sunday is the default rest day unless the parties agree otherwise in writing. Labor reform, arts. 10 to 14 · Labor Code, art. 168

• Vacation and holidays. Allow 15 paid working days of vacation per year of service and check the paid holiday calendar when planning coverage. Count vacation in working days for the applicable schedule. Several statutory holidays move to Monday. Labor Code, arts. 186 to 192 · Holidays law
• Sick leave. For certified incapacity due to ordinary illness, the employer funds the first two days. The health insurer (EPS) is responsible from day three under the applicable benefit rules. Sick pay rules
• Parental leave. The baseline is 18 weeks of paid maternity leave and two weeks of paid paternity leave in 2026, subject to eligibility and documentation. Some births qualify for extended maternity leave, and qualifying parents can share part of the leave. Parental leave law · 2026 paternity benchmark

Employee benefits

The statutory package includes health, pension, occupational-risk and family compensation coverage, plus prima and cesantías under ordinary salary. Employees who qualify for the transport allowance receive COP 249,095 per month in 2026. Its wage ceiling is COP 3,501,810 where the allowance applies. Telework below twice the minimum wage has a replacement connectivity allowance. The temporary work-from-home rule uses an up-to-two-minimum-wages threshold for workers entitled to transport aid. Include applicable allowances in the basis for prima and cesantías. Transport decree · Benefit calculation law · Labor reform, art. 53 · Work-from-home law, art. 10

Check work clothing and footwear requirements for employees earning up to twice the minimum wage with more than three months of service at the distribution date. Collective agreements or an EST client's comparable terms can also change the package. Price optional supplemental health cover or meal benefits separately and confirm their payroll treatment. Labor Code, arts. 127 to 128, 230 to 234 and 467 · Law 50, art. 79

Onboarding and work authorization

1. Set the route and terms. The client gives the employing entity the job duties, work location, schedule, salary and planned start date. For an EST placement, document the reason and expected endpoint. The legal employer and employee agree the employment terms. Labor reform, arts. 5 to 6 and 45
2. Check work authorization before work begins. For a foreign national, verify that their status permits the role with the named employer. A migrant worker visa (M Trabajador) ties permission to the approved role and employer, so a switch of employing entity can change the start date. The hiring entity reports the start and end through SIRE within 15 calendar days of each event and registers the worker in RUTEC within 120 calendar days of contracting or engagement, where these duties apply. Visa rules · Migration reporting · RUTEC resolution
3. Arrange the medical assessment and enroll the employee. The employer collects the worker’s identity, bank and fund details, arranges the entry occupational assessment and sets up health, pension, family compensation and ARL coverage as applicable. ARL coverage begins the day after affiliation. Confirm enrollment early enough for coverage on the first day, then give the worker their first payday and the cutoff for submitting hours and other payroll changes. Occupational assessment rules · Government hiring checklist

Termination and final pay

Have the legal employer assess the reason, contract type and any special protection before communicating an end date. Pregnancy, disability or qualifying health conditions, and union protections can require prior authorization. For a fixed term that can renew, give at least 30 days’ notice if you plan to let it expire. Dismissal for certain statutory causes has its own notice rules. A client ending a temporary assignment should coordinate with the EST, which remains responsible for the employment decision and final settlement. Labor reform, art. 6 · Labor Code, arts. 61 to 65, 239 to 240 and 405 · Health protection ruling

For dismissal without just cause on an indefinite contract, the statutory indemnity is generally 30 days' salary for the first year or less, plus 20 days per later year, prorated for part-years, below 10 minimum monthly wages. At or above that threshold it is generally 20 and 15 days, respectively. For a fixed term ended without just cause, budget the salary for the remaining term. Labor Code, art. 64

At termination, settle outstanding wages, unused accrued vacation, and accrued prima, cesantías and interest still owed. The cesantías fund benefit accrues during employment and is a separate obligation from dismissal indemnity. Labor Code, art. 65 · Vacation payout law · Cesantías rules

Hiring with Borderless AI

Borderless AI's EOR service brings contract, onboarding, payroll and benefits administration together. For a hire in Colombia, bring the role, work city, gross salary, intended schedule, hiring horizon, supervisor and work-authorization status. Use those details to confirm the local employing entity and the arrangement that fits the work. Request an itemized quote that shows the employer contributions, benefit payment dates and service fee separately. Borderless EOR services · Book a demo