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7. Labor and employment: Colombia

Labor and employment in Colombia: how to hire under the Código Sustantivo del Trabajo as rewritten by the 2025 labor reform, the 42 hour week, night and rest day surcharges, the 2026 minimum wage and transport allowance, statutory benefits (severance, interest, service bonus, vacation), pension, health, risk insurance and payroll levies with the exemption below 10 minimum wages, dismissal compensation and contractor liability, each tied to the official text, with a tracker of scheduled changes including the 2027 pension reform.

Investor view. Colombia's labor costs are codified and predictable, with the payroll tax exemption below 10 minimum wages rewarding formal hiring, and the policy choice that best supports growth is to keep further cost increases tied to productivity so formal jobs keep expanding.

Employing people in Colombia: contracts, hours, pay, social security and dismissalColombia's Labor Code applies to every employee in the country, and the 2025 labor reform (Ley 2466) made the indefinite contract the default, capped fixed term contracts at four years, moved night wo