Employer of Record in Colombia

How hiring through an employer of record works in Colombia

The local employer is the party to the Colombian contract, registers the employee with the social security and family compensation systems and runs payroll, while your managers direct the work. Article 47 of the CST, as rewritten by Law 2466 of 2025, makes indefinite contracts the rule.

A verbal contract is valid, but a fixed-term contract must be written or it counts as indefinite from the start, and fixed terms cannot exceed four years. Occupational risk affiliation counts from the day after the insurer receives the form, so it is filed early.

Employer costs and contributions in Colombia

On the contribution base the employer pays 12% for pension, 8.5% for health, 4% to a family compensation fund, 2% to SENA and 3% to ICBF, which adds up to 29.5%. Occupational risk is paid entirely by the employer at 0.348% to 8.7% by risk class. The pension base is capped at 25 minimum wages.

Article 114-1 of the Estatuto Tributario exonerates income-tax-filing companies from health, SENA and ICBF contributions for employees earning under 10 minimum wages, leaving 16% plus occupational risk. Toku's compliance guide lists the 12%, 8.5% and 9% lines but not this exoneration.

Working time, leave and pay rules in Colombia

• Hours: 42 a week under Law 2101 of 2021, with overtime capped at 2 hours a day and 12 a week.
• Surcharges: night work (7 p.m. to 6 a.m.) adds 35%, daytime overtime 25% and night overtime 75%. Work on a rest day or holiday is moving to 100%: 90% from 1 July 2026, full rate from 1 July 2027.
• Leave: 15 working days of vacation after a year, 18 public holidays, 18 weeks of maternity leave and 2 weeks of paternity leave.
• Pay above 10 minimum wages can be a written integral salary of at least 10 minimum wages plus a 30% factor, covering prima, cesantías and surcharges but not vacation.

Cesantías and prima in Colombia

Cesantías are one month of salary per year of service, settled on 31 December and deposited before 15 February into the fund the employee chooses. The employer also pays the employee 12% annual interest. The prima is 30 days of salary a year, half by 30 June and half in the first 20 days of December.

Probation, notice and termination in Colombia

Probation is capped at two months, or one fifth of the term for a fixed contract under a year, and either side can end it without notice. After that, an employee gives 30 calendar days' notice.

An employer ending an indefinite contract without just cause owes compensation: under 10 minimum wages, 30 days for the first year plus 20 for each further year; from 10 minimum wages, 20 days plus 15. Dismissal for pregnancy or breastfeeding needs prior Ministry of Labour authorisation.

Getting paid in stablecoins, USDC, USDT, tokens and crypto in Colombia

Short answer: No. The Labour Code requires salary in legal currency, and the central bank and the financial regulator have said crypto assets are not legal tender, so a USDC payout cannot replace peso pay.

What the law says about the form of pay

Article 134 of the Código Sustantivo del Trabajo requires salary in money to be paid in legal currency, in periods of at most a month. Article 135 lets an employee whose pay is set in a foreign currency demand pesos at the official rate. Article 129 caps pay in kind at 50% of salary and gives food, housing and clothing as examples.

What it means for employee salary

Colombian salary therefore stays in pesos, and USDC or USDT cannot replace it. The Banco de la República said in 2019 that crypto assets are not money for legal purposes and nobody must accept them as payment. The Superintendencia Financiera's page, updated in June 2026, repeats that they are not legally recognised money. No official page reviewed treats stablecoins as lawful salary in kind. Toku confirms what applies to a specific hire.

Contractors

The tax authority treats crypto received for services as a payment in kind, with ordinary VAT and invoicing rules. That is a tax statement, not a rule on paying contractors in crypto.

Tax on crypto and tokens

DIAN's unified concept on crypto assets says crypto paid as compensation under an employment contract is a payment in kind and work income, valued at its commercial value on delivery. A price rise is taxed only on sale, a gain on an asset held two years or more is an occasional gain, and residents report crypto held at year end.

How Toku handles it

Employee salary in Colombia stays in local currency. Toku’s stablecoin payroll and its USDC or USDT payouts through contractor management are separate arrangements from employee salary, and token grants are administered through token grant administration. What applies to a specific hire in Colombia is confirmed before an offer.

Reviewed November 7, 2026 against the official sources listed below. General information, not legal or tax advice. Tax on crypto or tokens received depends on local rules and where the person is resident, so confirm it with a local adviser.

How hiring through Toku works in Colombia

1. Share the role, location, salary and start date.
2. Toku confirms coverage, the contract type and the right to work.
3. The local employer issues the contract and onboards the person.
4. Payroll, contributions and filings run each cycle.

Toku checks the role, location and contract type before a start date is set. Prepare identification, bank details, the signed contract and the agreed peso salary, and expect the employee to choose a pension fund, health insurer and cesantías fund. Your quote confirms the onboarding timeline for Colombia.

What an employer of record costs in Colombia

Where Toku supports the hire, its employer of record service starts at $599 per employee per month, with salary, employer contributions and benefit premiums itemized in your quote. Coverage in Colombia is confirmed before an offer. See the published pricing.

More on hiring in Colombia

• Colombia full-time hiring compliance guide
• Employer of record coverage in 100+ countries