When we think about expanding into Latin America, Colombia consistently stands out. Its evolving economy, growing talent pool, and simplified employment regulations have helped it become a preferred destination for companies planning regional growth. Still, understanding local compliance requirements isn’t optional—it’s the foundation for a safe, sustainable presence in the market. At EWS Limited, we have seen the difference that a solid grasp of Colombian workforce regulations can make for growing companies. We have put together this extensive guide, so you can understand every step of establishing a compliant hiring strategy in Colombia for 2026.
Colombia’s labor landscape has transformed over the last few years. The country reached a milestone in 2025 by achieving its lowest unemployment rate in a quarter-century, finishing the year at 8.9%, with December dipping to 8.0%. Those figures, reported by El País, signal a local environment ripe for companies seeking reliable hiring options.
Additionally, insights from BBVA Research highlight that as of mid-2025, employment levels were the highest in decades, with sectors such as retail, hospitality, public administration, health, and education fueling this progress.
Colombia employs nearly 24 million people—yet informality and rural-urban disparity change the rules of the game.
Informal employment rates persist at 52-55%, with rural regions experiencing rates as high as 80%. For international firms, this means that understanding not only the organized workforce, but also local hiring norms, is key to LatAm workforce compliance.
In our work with Series B and C startups, established tech companies, and multinational organizations, Colombia’s advantages become strikingly clear. The country’s workforce is skilled, offering deep experience in areas like IT, customer service, operations, and sales—all critical functions for global growth.
However, building a compliant hiring strategy requires careful planning, as Colombian labor law emphasizes employee rights, transparent processes, and regular updates based on government policy changes.
Colombia’s employment structure is shaped by three central cornerstones: the Colombian Labor Code, a sophisticated system for social security and benefits, and various external rulings that periodically update labor practices nationwide.
We consistently recommend companies review Colombian regulations with updated local knowledge, as the law frequently changes based on governmental guidance.
Hiring in Colombia is based on contract. The written agreement isn’t just a formality—it’s the backbone of every professional relationship, protecting both employer and employee.
For companies just entering the market or considering international payroll, learning more about Employer of Record services in Colombia helps ease compliance and reduce risk.
Colombia mandates strict compliance with payroll, tax, and social contribution requirements. Adhering to these ensures that companies avoid penalties and maintain credibility with both local authorities and potential employees.
Managing these elements in multiple currencies or across multi-country squads often leads to payroll outsourcing strategies—a model that EWS regularly implements for clients.
Understanding leave and termination policies is non-negotiable. Colombian legislation is worker-focused, and missteps in this area are some of the most common compliance tripwires.
Getting the details of hiring compliance right means balancing opportunity and responsibility—no shortcuts.
A smooth hiring journey starts with recognizing the most pressing risks. Based on our experience guiding companies across more than 100 countries, these are particularly relevant for Colombia:
All expansion efforts must account for these factors in hiring strategies and risk management plans.
Several of our clients, especially those in tech and fast-growing startups, have effectively built Colombian teams by paying attention to:
Each of these elements is covered extensively in our compliance checklist for international hiring, ensuring that teams start—and stay—on the right path.
How to prepare for hiring in Colombia: Step-by-step onboarding guideSetting up a compliant workforce in Colombia means following a logical sequence. We guide clients through every phase, ensuring both speed and reliability. Here’s our process:
Each onboarding stage builds compliance. No step should be skipped.
In 2026, Colombian talent is part of regional and global teams. Flexible working laws give companies broad scope when creating remote or hybrid environments.
Many of our IT and cybersecurity clients appreciate how scalable HR strategies allow them to respond quickly to local compliance changes while supporting their talent worldwide.
For companies looking to bring in expats, Colombia’s visa system supports various employment and business arrangements. However, legal sponsorship is required. The process includes:
Relocation is more than just paperwork. We provide support in managing logistics and legal compliance for incoming talent as part of our global mobility solutions.
Informal vs. formal employment: Why does it matter?As mentioned by El País and confirmed by BBVA Research, over half of Colombia’s workforce operates outside formal structures. For international firms seeking LatAm workforce compliance, working only within formal employment channels dramatically lowers risk.
Formal hiring isn’t just about following the law—it’s about building trust.
International companies often choose payroll outsourcing or an Employer of Record (EOR) for Colombia. These models allow teams to operate with full compliance, without the need for local legal entities.
If you want a deep dive into the differences between PEO and EOR models for your first hires in Colombia, see our article on PEO vs EOR for first overseas hires.
Hiring in Colombia in 2026 is about more than just labor law compliance. Companies that succeed here think proactively:
Connecting local insight with international standards is how we build strong and lasting workforces—and it’s a lesson we’ve applied in all our expansion projects.
Conclusion: A new opportunity for LatAm growthColombia’s workforce landscape in 2026 is defined by progress and opportunity. The country’s legal framework and digital transformation make it a solid gateway for LatAm expansion. However, successful hiring in Colombia relies on clear contracts, accurate payroll, up-to-date compliance, and robust local knowledge. These fundamentals not only reduce risk, but also create trust among new teams and future partners.
At EWS Limited, we dedicate ourselves to connecting the dots for your organization, offering tailored workforce and compliance solutions to make growth safe and sustainable. If you are planning a move into Colombia, reach out to understand how our global solutions and local expertise can drive your expansion with confidence.
The primary employment laws in Colombia are found in the Colombian Labor Code, which outlines employee rights, contract types, working hours, wages, vacation, leave policies, and minimum standards for local and foreign hires. The law also mandates compliance with social security and anti-discrimination protections, requiring all formal hires to be registered with health, pension, and labor risk funds.
We recommend a systematic approach to workforce compliance: always use written contracts outlining terms, register staff with required social security funds before their first payday, follow local payroll and tax deadlines, and store all records securely. It is also important to stay current with Colombian legal updates, adjust contracts if required, and complete regular payroll audits to avoid discrepancies.
Colombia recognizes three main contract types: indefinite-term, fixed-term, and work-for-specific-project agreements. Each must specify salary, role, work hours, benefits, and duration. Indefinite contracts allow for ongoing employment, while fixed-term and project contracts have rigid end dates and extra rules regarding renewal and termination.
Total hiring costs in Colombia include gross salary, employer and employee social security contributions (covering pension, health, family welfare, and solidarity funds), payroll taxes, leave entitlements, and severance if applicable. Salaries vary by industry and seniority, but employer costs typically add 30-40% above base salary. Formal employment protects against future financial penalties and administration costs associated with non-compliance.
For many organizations, hiring in Colombia delivers results: a large and skilled workforce, cost-effective salaries, time zone alignment with North America, and improved access to Latin American markets. Compliance can be complex but, with the right local support from EWS or through robust internal strategies, expansion into Colombia is a strong launchpad for broader regional development.
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