Colombia: government filed a labour reform bill proposal

On 16 March 2023, the government presented to Congress a labour reform bill, described as an ambitious project to improve the conditions and income of workers.
The bill is part of a raft of reforms: it followed the major tax reform last year, and the pension system reform is expected soon.
Both lawmakers and the Constitutional Court must approve it.

The event was led by Minister of Labor Gloria Inés Ramírez, accompanied by Vice President Francia Márquez, Minister of the Interior Alfonso Prada, and other officials.

Cases from Mexico, Spain, Chile, and Argentina were studied for drafting the bill, which, with its 76 articles, modifies the Substantive Labour Code and aims to reinforce job stability.

The main provisions are the following:

1. REINFORCE JOB STABILITY: The standard contract model is the open-ended contract, except in exceptional cases of fixed-term contracts whose maximum duration is two years.

2. REDUCTION OF WORKING TIME: from 15 July of 2023, a progressive implementation of the maximum working time to 42 hours per week and 8 hours per day will start (in 2023, 47 working hours per week, in 2024, 46 working hours per week, in 2025 44 working hours per week and 2026 42 working hours per week). The daytime working day is determined from 6:00 am to 6:00 pm, and night work from 6:00 pm to 6:00. The reform also sets out an increase in the percentage of Sunday surcharge.

3. REGULATION OF DELIVERY TECHNOLOGY PLATFORM: all companies whose collaborators work through this digital option must ensure that they are affiliated and independently pay their social security (health, pension, and occupational risks) on time. If the worker is not insured (independently or on behalf of the company) and suffers a risk covered by social security, the company will assume the costs.

4. COLLECTIVE BARGAINING: the bill introduces new rules on the right of association to avoid collective agreements with non-unionised workers and new regulations for sectoral or industry-level bargaining.

The President of the Colombian Business Association (ANDI), Bruce Mac Máster, criticised the bill, arguing that any project for workers that do not seek to reduce informality or generate greater job opportunities is inconceivable. Furthermore, he emphasised that any proposed changes in the world of work must consider the potential consequences they may have on the broader social world.

As we previously reported, he already expressed concern last year about the potential impact of rising costs in the Colombian labour market, stressing that there is a significant risk that rising costs may incentivise people to move into informality or discourage employers from formally employing workers.

In the same way, the President of the National Federation of Merchants (Fenalco), Jaime Alberto Cabal, warned that the effects of the labour reform could be adverse: “The reform risks hurting job creation. It forgets about the unemployed, the opportunity to access work and the possibilities for informal workers to get formal work due to the high costs”.