What has been approved and the articles that are missing to make labor reform a reality in Colombia

After several months of debate, proposals, and opposition, the approval of the labor reform has entered its final stages , and the final discussions will take place in Congress this week.

Since this is the second legislative session in which it has been debated, its approval must be finalized before June 20; otherwise, it will fail due to insufficient processing, as extra sessions do not apply in this case.

Senate plenary debates will resume this Monday, June 16 , and, according to Congresswoman Angélica Lozano, there is "plenty of time." The goal is to complete the approval of the remaining 19 articles that day.

The reconciliation of the texts approved by the Senate and the House will take place on Tuesday and Wednesday, while the unified text is expected to be approved in both plenary sessions between Thursday and Friday.

If this timeline is met and the labor reform is completed before midnight this Friday, the bill will be submitted to President Gustavo Petro for approval to begin implementing the approved changes.

"There will be fair labor reform by law, and the 'decree' falls by its own weight. It's an abuse of power, and the president (Gustavo Petro) will have to justify how, despite a well-crafted reform, he persists in violating the Constitution," said Angélica Lozano, also president of the Senate's Fourth Committee.

There will be fair labor reform by law, and the decree collapses under its own weight.

So far, congressmen have approved 57 articles and eliminated one during the debates held this week in the Senate plenary session. The House of Representatives will process the bill in October 2024.

The deleted article was Article 17, which sought to create a 4 percent bonus, in addition to what workers currently receive. It would be paid when companies recorded economic growth above 4 percent.

Among the approved articles, those that stand out are those that establish as a general rule the indefinite term employment contract (5) and that, in no case, overtime work hours, day or night, may exceed two hours daily and 12 weekly (14).

In addition, the articles on the work experience of persons deprived of liberty (21) and the remuneration with a salary not less than the minimum for medical students who meet the admission requirements to carry out the mandatory medical internship (24) were passed.

Other approved articles have to do with social security and occupational risks in digital delivery platforms (29) and the possibility that micro-enterprises and households can make part-time social security payments (36).

Also highlighted is the creation of a first employment program for young recent graduates through the generation of incentives for companies (47) and the employer paying a connectivity subsidy for teleworkers who earn less than two minimum wages, replacing the transportation subsidy (57).

Some of the articles yet to be approved have generated the most concern among employers, as they would significantly increase labor costs.

One of them is Article 11, which seeks to advance the current night shift from 9:00 pm to 7:00 pm. In addition, it seeks to increase the remuneration for working on a holiday or Sunday from 75 to 100 percent (Article 15).

This change would be implemented gradually: starting July 1, 2025, it would be 80 percent; a year later, it would rise to 90 percent, and 100 percent would be reached on July 1, 2027.

According to Anif, with a reduction in daytime hours and no changes in schedule, the additional amount a company will have to pay for a worker earning the minimum wage (1,423,500 pesos) will be approximately 113,233 pesos, equivalent to an 8 percent increase in the base salary.

Furthermore, with the 100 percent surcharge for Sundays and holidays, a company would have to pay an employee 363,963 pesos working from Friday to Wednesday, as opposed to the current 272,972 pesos. This represents a 6.4 percent increase in costs.

Anif's analysis also indicates that these changes will primarily affect sectors whose operations take place during the night, on Sundays, and on holidays, such as commerce, lodging, restaurants, entertainment, transportation, and some industries, especially the food industry.

In addition, with higher cost overruns, companies would have no incentive to create new jobs in the country. On the contrary, they could be encouraged to move into the informal sector and thus avoid the new costs.

Anif estimates that, under a medium-term scenario, job losses in these economic activities could reach 140,000, with the main pressure factor being the increase in costs resulting from the change in daytime work.

Another issue in this labor reform that has generated considerable controversy concerns SENA apprentices. For example, Article 25 states that companies required to comply with the apprenticeship quota will have to pay 1.5 times the minimum wage each month for each apprentice they do not hire.

Similarly, Article 23 establishes that apprentices will receive 75 percent of the minimum monthly wage from the company during the training period, while in practice it must be a full salary.

Also pending approval are articles related to reinforced job stability (9), a four-day work week and three days of rest (12), part-time workers (37), guarantees of the right to union association (63), the connection of community and substitute mothers (74) and the labor formalization of food handlers of the PAE (75), among others.

For Anif, the additional labor costs brought about by the reform most significantly affect certain activities with less capacity to generate formal employment and smaller companies.

For this reason, its president, José Ignacio López, recommends incorporating a paragraph establishing the obligation to conduct an evaluation of the reform's effects on the labor market two years after its entry into force.

If a decline in formal employment levels is evident, an extension of the transition period to the new surcharges for work on rest days and a review of other labor costs should be considered .

On the contrary, if it is concluded that the formal labor market is not affected, and the evaluation is favorable, there would be no change.