New minimum salary, transportation allowance set for 2020
3 Jan 20
IMPACT – MEDIUM
What is the change? Colombia has set new minimum salary and transportation allowance rates.
What does the change mean? Effective Jan. 1, employees must be paid a minimum salary of COP $877,803 (about US$266). Employees who make less than double the minimum salary are also entitled to a monthly transportation of COP $102,854, for a combined minimum of COP $980,657 per month. Employers should also not that Colombia employers that sponsor foreign workers maintain a monthly balance of at least 100 times the minimum salary. This means that these companies monthly balance must exceed COP $87,780,300 under the new wage rate.
- Implementation date: Jan. 1.
- Visas/permits affected: Work visas.
- Who is affected: All Colombian employers, particularly those who sponsor foreign workers on work visas.
Additional information: The Colombian National Government issued Decrees 2360 and 2361 on Dec. 26, setting the new minimum salary and transportation allowance rates.
Analysis & Comments: The new salary minimum represents a 6-percent increase over the 2019 minimum of COP $828,116. The increase will not impact salaries for most high-skilled foreign workers who are generally paid far more than the minimum salary. Employers should account, however, for the increase as it will impact the business balance required for sponsoring work visas.
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