Grounds for Termination
In Colombia, employment contracts may be terminated by any of the parties at any moment with immediate effects (as a period of notice is only needed for fixed-term contracts when ended by the expiration date) and without it being necessary to mention the reasons that led to the termination, unless a fair cause is alleged for the dismissal. Grounds for termination in Colombian legislation can be divided into three categories: (i) Legal grounds. (ii) Termination with a fair cause. (iii) Termination without a fair cause. The termination without a cause includes all situations that are not considered as a legal cause or a fair cause. Employees are also entitled to terminate the employment contract at any moment, for any reason, or alleging a fair cause.
The requirements for a collective dismissal, which in Colombia, applies to a dismissal that affects, in a period of six months, a number of employees equal to: (i) 30% of the total employees in companies with a total share of employees higher than 10 but lower than 50; (ii) 20% of the total employees in companies with a total share of employees higher than 50 but lower than 100; (iii) 15% of the total employees in companies with a total share of employees higher than 100 but lower than 200; (iv) 9% of the total employees in companies with a total share of employees higher than 200 but lower than 500; (v) 7% of the total employees in companies with a total share of employees higher than 500 but lower than 1000 and; (vi) 5% of the total employees.
in companies with a total share of employees higher than 1000. The percentages mentioned above are only calculated when considering terminations without a fair cause, not those alleging a legal ground or a fair cause. For a company to proceed with a collective dismissal, it needs, beforehand, to receive authorisation from the Ministry of Labour.
Individual dismissals, unlike the collective dismissals, do not require a previous authorisation by any authority, as the employer is free to terminate the employment contract at any time. However, for the dismissal of an employee under some types of special protection, an authorisation from the labour inspectorate is needed (pregnant women, disabled employees). In the case of employees under special protection for their unionised condition a prior authorisation is required by the labour judge.
Is Severance Pay Required?
Only for a dismissal without a cause. The amount of the severance payment differs in several factors such as seniority, type of contract and amount of the salary. The reference to calculate the severance payment must take into account the last fixed salary. In case of variable salary, the reference would be the average of the salaries earned in the last twelve months. Colombian legislation provides a fixed system of calculation for the severance payment. Nonetheless, employees can claim moral damages in addition to the severance payment provided by law.
Colombian Labour law does not require a separation agreement to terminate a contract. Nevertheless, it allows its application. These kinds of agreements are not only widespread in the labour market, but are generally recommended to terminate the contract of high executives and employees under special protection.
Remedies for Employee Seeking to Challenge Wrongful Termination
Wrongful termination claims are analysed by the judge as the competent authority. Wrongful termination based on a legal ground (i.e. alleging the absence of a cause for the termination) leads to the recognition of the severance payment the employee would be entitled to if his contract would be terminated without a cause.
Wrongful termination based on the breach of a fundamental right (i.e. discrimination grounds and/or harassment) might lead to the reinstatement of the employee in the position he was in before being dismissed, or an equivalent one, plus the payment of the salaries and benefits for the period he remained dismissed, because of the employer’s wrongful terminate.
Colombian labour law does not include any special provisions or protections for whistleblowers. However, employees who served as witnesses in a claim of harassment cannot be dismissed without a fair cause in the following six months after the formal complaint, as long as the claimant is effectively considered a victim of harassment.