How Will an Employment Law in Colombia Affect Productivity?

In our most recent Q&A, Daniela Jaimes Bautista, Colombia’s Nation Supervisor for Biz Latin Hub, discusses the Colombian government’s plans to slowly decrease the (official) operate 7 days from 48 to 42 hours and basic work legislation in Colombia.

Ms. Jaimes is a lawyer specialising in industrial Law, with 10 a long time of working experience in the fields of company, commercial and work legislation in Colombia in the provider sector.

See also: Beginning a small business in Colombia.

Biz Latin Hub: What will be the most considerable changes to Colombia’s workday in 2023?

Daniela Jaimes: Setting up mid-2023, the 48-hour operate 7 days will progressively be lowered. Colombians will work one particular hour fewer every 12 months, which will not negatively impact their salary, added benefits, or the value of the everyday operating hour. The original aim of the measure is to lessen the workday to 42 functioning hours per 7 days by the calendar year 2026. It will start with a single hour considerably less in the first two decades (2023 and 2024) and two hours a lot less in the following decades (2025 and 2026).

BLH: Colombia’s so-identified as “21/01 of 2021 Law” will steadily lessen formal get the job done time from 48 hrs per 7 days to a most of 42 hrs by 2026. What implications will this regulation have on Colombia’s economic system and efficiency?

DJ: Many users of Congress feel that lowering the functioning working day in Colombia is not viable, considering that the economy is likely by a essential instant. It is also unsure what adverse results this monthly bill could have on the country’s small business neighborhood. Moreover, they argue that it does practically nothing to decrease informal performing in the nation and could even exacerbate the predicament.

It is legitimate to presume that minimizing the performing day could direct to lessen generation owing to much less operating hrs. Furthermore, it would imply financial repercussions for the employer in the situation of needing a employee for far more hours, and the need to have to pay for much more several hours that would presently be regarded as additional time will commence to crop up.

Numerous analysts place out that this transform is not advisable for the productive sector and that this is an inconvenient time because we know the issues that firms are going by way of. Most are hoping to reactivate and resume the speed of generation pre-pandemic. They argue that this evaluate might have an impact on the risk of restoration by having less performing several hours, which could result in less productive working time, or the need to have to hire extra employees, increasing output charges.

On the other hand, Colombia was in default of complying with the tips of the ILO considering the fact that 1962 and the connect with of the intercontinental community on the reduction of the optimum working day as a system to totally free the employee from work burdens, which permits the satisfaction of loved ones, social, recreational, and cultural spaces that will strengthen social indicators.

Nevertheless, even though Law 2101 of 2021 lowers the highest operating working day from 48 to 42 hrs for each 7 days, the employment regulation inColombia will continue to be previously mentioned the normal working day of the OECD member nations, which is 37 hours for each 7 days, nor will it achieve the usual operating day proposed by the ILO of 40 several hours for every week, a work 7 days discovered in a lot more successful nations around the world.

BLH: What sectors/industries are most likely to be most impacted by this work hours-reduction work law in Colombia?

DJ: The sector that has had the most unfavorable thoughts about the new law is the industrial sector. The Nationwide Association of Business owners (ANDI) has expressed its feeling on this make any difference, stating that decreasing performing hours does not imply a reduction in the time of the effective processes in a business, which means that more personnel would have to be hired. The sectors that subsist on creation by lowering functioning hrs would be the most afflicted by owning to retain the services of much more staff or shell out additional time beyond regulation.

BLH: What does the Colombian federal government say is the motivation for decreasing get the job done hrs from 48 to 42? What is the reasoning guiding it?

DJ: The motivation that at first led to having this measure was workers’ psychological health and fitness and productivity by minimizing the necessary hrs of Colombian staff, growing high quality time with spouse and children and good friends, etcetera. On top of that, the regulation is made so that workers have additional cost-free time that they can use to get further education and purchase new expertise. The expectation is that it will lessen the absenteeism of workers, reward the reactivation of employment, and build a superior awareness of the partnership among companies.

It is starting to be significantly prevalent to see a lot more companies adopting adaptable measures, this sort of as functioning Fridays till midday and building far more flexible work schedules. I believe that the spirit of this laws is to produce a improved do the job/life equilibrium for staff.

BLH: As you talked about, the ANDI thinks the employment legislation in Colombia could have adverse outcomes on Colombia’s financial system since the output processes will have to alter to the new improvements, ensuing in paying far more extra time or far more staff being hired to manage current output degrees. Is this a fair assessment of the new workday regulation?

DJ: Considering that this new operating agenda has not nonetheless been put into practice, there’s only speculation about this new law’s feasible positives and negatives. But the assessment of the ANDI from an goal point of check out can make a lot of sense. The reduction of the operating day would have consequences, primarily for the industrial sector less doing work hours implies fewer production of goods which would increase their cost, and it would develop into essential to employ the service of far more team to maintain output levels. If the employer is unwilling or unable to employ much more workers, the employer will deal with bigger fees in spending additional time to employees. This would not accomplish the law’s target of generating more absolutely free time for family members, coaching, and so forth.

It is vital to see how this measure will evolve and how advancements that genuinely reflect the labour realities of employees and businesses in Colombia can be carried out together the way.

Biz Latin Hub can aid you with work legislation in Colombia

At Biz Latin Hub, we present integrated market entry and again-office providers during Latin The usa and the Caribbean, with places of work in Bogota and Cartagena, as nicely as in excess of a dozen other big cities in the region. We also have trustworthy associates in lots of other marketplaces.

Our unrivalled access means we are preferably put to assist multi-jurisdiction sector entries and cross-border operations.

As nicely as know-how about employing in Colombia, our portfolio of companies includes hiring & PEO accounting & taxation, organization formation, lender account opening, and corporate lawful products and services.

Get in touch with us now to discover additional about how we can help you in finding best talent or accomplishing company in Latin The us and the Caribbean.

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