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Termination and Severance Policies

Learn about the legal processes for employee termination and severance in Colombia

Notice period

In Colombia, the approach to notice periods during employment termination is unique. According to the Colombian Labor Code (Código Sustantivo del Trabajo - CST), employment contracts can be terminated by either party at any time with immediate effect [Art. 66 CST]. This implies that there's no legal requirement for employers to provide a notice period before termination, unless specific exceptions apply.

Exceptions Requiring Notice Periods:

Although a general notice period isn't mandatory, Colombian law outlines a couple of exceptions where notice is required:

  • Fixed-Term Contracts (Art. 45 CST): If an employer decides not to renew a fixed-term contract upon its expiry, they must provide the employee with written notice at least 30 days before the contract end date [Art. 45 CST].

  • Termination for Cause with Specific Misconduct (Art. 62 CST): In specific instances of employee misconduct as outlined in Article 62 of the CST (numerals 9 to 15), employers must provide the employee with written notice at least 15 days before termination [Art. 62 CST]. These reasons include serious breaches of discipline, insubordination, or negligence leading to material damages for the employer.

It's crucial to note that the specific reasons for termination outlined in Article 62 CST must be demonstrably true and fulfill the legal definition of "just cause" for termination to avoid legal challenges from the employee.

Severance pay

In Colombia, severance pay, also known as Cesantías, is a mandatory financial compensation provided to workers who lose their jobs due to reasons beyond their control. This compensation is designed to offer financial support during periods of unemployment.


Severance pay is applicable to employees under fixed-term and indefinite-term contracts. However, certain categories of workers such as temporary employees, independent contractors, or domestic workers with less than one month of service may not be eligible for this compensation.


The calculation of severance pay is based on the length of service and the salary of the employee. Employees with longer service periods and higher salaries receive greater severance amounts. The calculation formula varies for employees earning less than 10x the minimum wage and those earning more than 10x the minimum wage.

The legal framework for severance pay in Colombia is provided by the Colombian Labor Code (Articles 249-259) and Law 50 of 1990, which reformed severance and adjusted the calculation methods.


Employers are responsible for calculating and paying severance. They are required to deposit severance annually into a Cesantías fund chosen by the employee, with a deadline of February 14th. Employees can withdraw from their fund for reasons such as job termination (without just cause), housing purchase/improvement, and education costs.

Important Considerations

If an employee is terminated "with just cause" as defined by Colombian law, they may lose their right to severance. It's also important to note that severance entitlements are separate from other termination payments that the employer may need to provide.

Termination process

In Colombia, termination of employment contracts can generally be categorized into two main types: termination with just cause and termination without just cause.

Termination with Just Cause

When an employee engages in behaviors or actions deemed as "just cause" under Article 62 of the Colombian Labor Code, the employer has the right to terminate the employment contract. Examples of such behaviors include repeated instances of misconduct or negligence, physical or verbal abuse in the workplace, serious violations of company policies, and criminal actions impacting the workplace. In cases of "just cause" termination, employers are not obligated to provide advance notice or severance pay. However, they must clearly communicate the grounds for termination in writing.

Termination without Just Cause

Employers can terminate an employee's contract without specific cause, which is the most common form of termination in Colombia.

Special Cases

If an employer needs to dismiss a substantial number of employees, they require prior authorization from the Ministry of Labor. Termination of employees with special protections (e.g., pregnant workers, those with disabilities, union members) may require additional processes or approvals from the Ministry of Labor or a labor judge.

Termination Procedure

Termination must always be communicated in writing, clearly stating the reasons (if applicable) and the effective termination date. Employers must ensure prompt and complete payment of all outstanding salary and social benefits.

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