One in four employers face a legal risk when ending an employment relationship, yet many companies miss simple steps that prevent disputes.
We set the context for employers operating in Colombia by outlining the three legal categories that end a work contract and when severance applies.
Our goal is clear: help you pick the correct legal basis, calculate amounts accurately, and follow procedure to avoid fines or wrongful-dismissal claims.
Article 62 of the labour law governs fair cause and requires a written notice citing the legal or contractual standard and the facts that justify action.
We explain timing rules — when a fixed-term non-renewal needs prior notice, how pay through the end of a term is calculated, and what final pay must include.
Key Takeaways
- There are three legal categories for ending employment and only some trigger severance.
- Article 62 requires written grounds for fair-cause dismissals.
- Fixed-term early ends pay the remaining term; indefinite contracts follow set formulas.
- Protected workers and mass layoffs need prior authorization to avoid reinstatement.
- Final payments must include salary, accrued benefits, and any owed severance.
Understand search intent and when to use this termination severance Colombia guide
We give concise, actionable guidance for HR, legal teams, and employers who handle employment endings. Use this guide when you need clear steps to end a contract lawfully and to calculate final pay correctly.
Who should use this resource
HR teams, in-house counsel, and employers will find practical checklists for managing employees, contracts, and hiring decisions. We explain the key requirements under the labour law and show when written notice and documentation matter.
When to consult this guide
- Non-renewal of fixed-term contracts and the 30 days’ notice rule.
- Fair-cause dismissals that must meet Article 62 standards in writing.
- Role eliminations, reorganizations, or cases with variable pay where salary references differ.
| Scenario | Key action | Timeline (days) |
|---|---|---|
| Fixed-term non-renewal | Provide written notice | 30 days |
| Disciplinary dismissal | Document facts under Article 62 | Immediate, with written citation |
| End without cause | Coordinate HR and legal; calculate pay | Pay on last working day |
Identify the basis for ending employment under Colombian law
We clarify the legal categories that end a work contract and the obligations each creates. Choosing the correct basis matters because it defines pay, approvals, and potential remedies.
Legal grounds that end the contract by operation of law
Some events end a contract automatically and do not generate severance. These include expiry of a fixed-term, completion of a definite-task agreement, and the death of an employee.
Fair cause and documentation
Fair cause is closed-listed under Article 62 of the labour code. We must cite the exact legal or contractual standard and record the facts in writing when we dismiss for cause.
Preserve evidence: investigation files, warnings, and performance reviews help defend a fair-cause decision in court.
Dismissal without cause and limits
Ending service without cause is lawful but triggers severance based on the regime and salary level. Use of this basis is limited for protected employees (pregnancy, disability, union fuero), where prior authorization or reinstatement may apply.
If an employee resigns claiming employer breach, the law treats the exit as employer-driven for pay and remedies.
- Map the intended basis first: it determines approvals, pay, and processes.
- Keep written notice, facts, and records to reduce wrongful-dismissal risk.
| Ground | Effect on pay | Requires written notice | Risk for protected employees |
|---|---|---|---|
| Fixed-term expiry | No severance; final pay due | No | Low |
| Definite-task complete | No severance; final pay due | No | Low |
| Fair cause (Article 62) | No severance if upheld | Yes — cite facts and law | Medium |
| Without cause | Triggers severance | No statutory notice | High — may need authorization |
Map the employment contract type before acting
The starting point is to map which kind of employment agreement applies to the worker.
Indefinite-term contracts allow dismissal at any time, but a payment obligation arises when the employer ends the relationship without cause. Check salary regime and thresholds to compute the amount correctly.
Fixed-term contracts require a 30-day written notice to avoid automatic renewal at expiry. If we end a fixed-term early without just cause, we must pay through the original end date.
Definite-task agreements end when the task finishes. Early termination without justification can trigger compensation tied to the remaining portion of the task.
Practical checks: confirm any valid probation clause, review whether pay is fixed or variable, and verify special protections for the role or employee status before action.
- Align HRIS and templates to display contract category clearly.
- Plan redundancies and collective actions based on contract mix.
- Document the contract basis in writing before any termination step.
| Contract type | Notice / rule | Early-end consequence |
|---|---|---|
| Indefinite-term | No statutory notice | Severance due if without cause |
| Fixed-term | 30 days to avoid renewal | Pay remaining term if ended early |
| Definite-task | Ends on task completion | Compensation for remaining task if ended early |
Set notice and timing requirements the right way
Setting precise timelines for notices is the simplest way to reduce legal risk and ensure orderly departures. We must align calendar dates, written notices, and payroll so employees and managers know what to expect.
Fixed-term contracts and 30-day rule
For fixed-term contracts, provide at least 30 days’ written notice before the contract end date to avoid automatic renewal. If we end a fixed-term early without just cause, we must pay the salary for the remaining term.
Indefinite-term and common practice
Indefinite-term contracts carry no statutory notice requirement. Still, giving 15 days is a common practice to allow handovers and payroll coordination.
Probation and timing limits
Probation is optional. When used, it runs up to two months for indefinite contracts. For fixed-term hires, probation may be up to one-fifth of the contract term, but cannot exceed two months.
- Document probation goals and feedback to support quick decisions within the window.
- Calendar critical dates and send written notices ahead of the deadline to avoid inadvertent renewals.
- Confirm receipt of notices to reduce disputes over delivery and timing.
Calculate severance pay accurately and on time
We break down payment rules by hire date and salary to ensure correct calculations. Accurate math reduces dispute risk and speeds final payment at exit.
Fixed-term contracts
Fixed-term contracts ended early without cause require payment equal to the salary for the remaining agreed period. Make this payment on the last working day with accrued benefits.
Indefinite-term regimes
- Hired before Jan 1, 1981: 45 days for the first year, 30 days for each additional year or pro rata. These employees may enjoy special stability under the laws.
- Hired before Dec 28, 1992: 45 days first year, 40 days per additional year or pro rata.
- Hired after Dec 28, 1992: formulas depend on salary versus the minimum wage. If salary is under 10 times minimum, use 30 days first year and 20 days per additional year. At or above 10 times, use 20 days first year and 15 days per additional year.
Salary reference rules
Use the last fixed salary as the base. For variable pay, compute the 12-month average. Apply pro rata for partial year service and document each step.
| Contract / Hire date | First year | Each additional year |
|---|---|---|
| Fixed-term (early end) | Pay remaining term salary through original end date | |
| Before 1‑Jan‑1981 | 45 days salary | 30 days per year (pro rata) |
| Before 28‑Dec‑1992 | 45 days salary | 40 days per year (pro rata) |
| After 28‑Dec‑1992 | 30 or 20 days (depends on times minimum) | 20 or 15 days (depends on times minimum) |
Note: severance is due only for dismissal without cause. We recommend validating special stability rules for older hires and keeping the calculation file to support the payment and any later claims.
Handle special protections and approvals before termination
Before we act, we identify any legal protections that block ordinary exit routes. This step avoids surprise reinstatement orders and costly litigation.
Who is protected: pregnant employees, workers with disabilities, and staff with union fuero. These groups need prior authorizations that ordinary dismissals do not.
Required approvals and risks
- Pregnancy and disability: the labor inspector must authorize an employer action. Acting without this approval risks an ineffective outcome and reinstatement.
- Union protection (fuero): a labor judge must grant prior authorization before we proceed.
- Using dismissal without cause for protected staff is usually barred until approvals are secured.
| Protected group | Authority | Impact |
|---|---|---|
| Pregnant / disability | Labor inspector | May add weeks or months; risk of reinstatement |
| Union fuero | Labor judge | Requires judicial permission; high litigation risk |
Practical steps: flag protections in HR, document cause thoroughly, consider role adjustments or accommodations, and consult counsel early when union leaders or board members are involved.
Termination severance Colombia: step-by-step process and employer obligations
We outline the precise procedural steps employers must take to communicate and settle an employee exit. Our focus is on clear written notice, accurate final pay, and recorded proof to reduce dispute risk.
Written communication and delivery
Prepare a written notice stating whether the action is for fair cause or without cause. Cite the breached legal or contractual standard and the key facts.
Confirm delivery: obtain acknowledgment and keep a copy in the personnel file as proof.
Final payments and closure steps
Pay the final salary, accrued vacation, bonuses, social benefits, and any due pay on the last working day.
When pay includes a dismissal payment, show a clear breakdown and attach calculations to the exit file.
- Collect company property and revoke access with signed receipts.
- Consider a conciliación before the Labor Judge or Ministry to make a settlement final.
- Coordinate with payroll for correct withholdings and issue receipts to the employee.
| Step | Action | Owner |
|---|---|---|
| Notice | Draft, cite facts, serve and file proof | HR / Legal |
| Final pay | Calculate salary, benefits, and dismissal pay if due | Payroll / Finance |
| Closure | Recover assets, revoke access, provide certificates | IT / Facilities / HR |
Manage collective dismissals and redundancy lawfully
Collective layoffs require a clear plan so we comply with the legal bands that apply over any six‑month window. We must count only terminations without a fair cause when measuring thresholds.
| Company size (employees) | Threshold (6 months) |
|---|---|
| 10–50 | 30% |
| 50–100 | 20% |
| 100–200 | 15% |
| 200–500 | 9% |
| 500–1,000 | 7% |
Authorization and sequencing
Before we execute group exits, the Ministry of Labour must authorize the process. We submit a formal application and wait for approval to avoid fines or invalidations.
We advise sequencing actions, using hiring freezes and redeployment, to prevent crossing thresholds unintentionally. Track cumulative terminations across sites and count only those falling under dismissal without cause.
Practical compliance steps
- Document a clear redundancy rationale and objective selection criteria to show proportionality.
- Coordinate consultation and communication to protect employee relations and reputation.
- Estimate severance budgets and cash flow effects; pay affected employees on the last effective day.
- Record days, effective dates, approvals, and execution evidence for audits or inspections.
- Exclude legal‑ground exits (e.g., task completion) from threshold counts to keep tracking accurate.
Use separation agreements and post-termination clauses wisely
A well-drafted separation agreement can convert a risky departure into a predictable legal outcome.
We recommend using agreements for senior or protected employees to reduce disputes and secure finality. These documents are optional but common in complex exits.
Choosing transacción or conciliación
A transacción is a private settlement between the parties. A conciliación adds judicial or inspector approval and offers stronger enforceability.
Mutual concessions are essential in both forms to create res judicata effect.
Post-exit restraints: non-compete and non-solicitation
Non-compete clauses must be reasonable in scope, territory, duration, and include fair compensation to stand in court.
Customer and employee non-solicitation clauses usually act as behavioral expectations. They rarely serve as solid litigation shields.
- Standard clauses: general release, confidentiality, return of property, non-disparagement, dispute resolution.
- Do not waive statutory entitlements; social contributions and core rights remain payable.
- Align any agreement with the termination letter and severance calculations and allow time for counsel review.
| Feature | Transacción | Conciliación |
|---|---|---|
| Authority | Private | Judge or labor inspector |
| Enforceability | Good if signed; stronger with conciliación | High — difficult to challenge |
| When to use | Routine executive exits | High‑risk disputes or protected employees |
From disputes to safeguards: wrongful termination, remedies, and your compliance checklist
We outline how careful documentation, correct pay calculations, and required approvals prevent costly workplace claims.
Labor judges decide wrongful claims and will assess whether we proved fair cause. If we cannot, the usual remedy is the severance pay due for dismissal without cause. For breaches of fundamental rights, judges may order reinstatement plus back pay and benefits.
Our compliance checklist keeps employers safe: choose the correct legal basis, secure approvals, write precise notices, compute final pay accurately, and pay on the last working day. We integrate salary thresholds and year service rules into templates to reduce manual errors.
We keep evidence logs, train managers on lawful communications, monitor protections windows for witnesses, centralize terminations, and run audits so the company controls risk and protects workers under the law.
