Although the labor reform project is still pending to begin its debates in the Seventh Commission of the Chamber, the initiative has aroused concern about its scope and the way in which companies will be affected if it is approved as presented by the Government.
Undoubtedly, the project generates various challenges that will affect the company-employee relationship in the country. BéndiksenLaw, a law firm specialized in advising national and multinational companies, recently held a webinar on the subject and revealed 6 elements that will impact working conditions in companies. These are:
1. Higher labor costs
According to Sebastián Béndiksen, a lawyer and Master of Laws from the Universidad de los Andes, “virtually everything will be more expensive for companies. All the surcharges go up and all the indemnities go up, the apprenticeship contract goes up in terms of the amount that the companies have to pay. Additionally, paternity leave will be extended, which will also affect costs.
With the entry into force of the reform, the payment of the night surcharge for the companies will begin for working hours from 6 pm – article 16 -, currently this surcharge is paid from 9 at night, so the companies will have to assume a extra cost in their operations.
Likewise, working hours and the time that a server can work would be limited. “In this sense, the companies that are on the limit after this reduction will have to hire new staff because they are going to run out of people to fill those shifts; in places that have to work 24 hours, they will have to hire new staff,” said the lawyer.
In this same sense, the reform comes with an obligation for companies to adjust wages that are below 2 minimum wages with the CPI -Article 70-. “This could be a heavy burden, especially for the smallest companies, which are the ones that handle this type of salary the most, there their operating costs will also rise significantly,” said Béndiksen.
Article 20 of the reform would also be forcing companies to pay a 100% surcharge for work carried out on Sundays, currently it is 75%.
2. Greater job stability
The reform seeks to generate greater stability for workers and for this it would be limiting the way companies hire according to Article 5. “With the reform it will be much more difficult to hire by work or by period, the general rule would be the contract indefinite-term employment, then it would be more stability for workers, but also higher costs for employers,” he pointed out.
In this same sense, the reform will limit companies much more when laying off their employees. According to Béndiksen, if companies arbitrarily or discriminatoryly dismiss employees, they will have the right to request reinstatement.
3. Limitation of outsourcing
With the reform it will also be much more difficult to have contractors or have temporary service companies -Article 13. “Once the provision of the temporary service, which can last a maximum of one year, cannot be extended or contracted with a service company different times”.
Another aspect that will affect companies with the labor reform is that when companies outsource their services, it will be easier for them to end up being declared the true employer in the face of a legal dispute, despite outsourcing. “So, I have outsourced my marketing services to a contractor, but after the reform it will be much easier than during litigation, say no, that company was a mere intermediary and in reality the employer is BéndiksenLaw,” he explained. .
According to the analysis of the expert law firm in corporate law, after the reform, companies will also have many problems hiring temporary employees and the employment relationship will be increasingly difficult to avoid. “With this reform, companies like Rappi would have to convert their rapitenderos into workers and they would stop being independent contractors. There is a whole title in the reform aimed at regulating how digital application companies operate”.
4. Review of Internal policies
All companies should review their current contracts and their internal regulations. This is because the due process to dismiss someone from the company would change and issues such as inclusion and the right to strike must be included in internal policies.
“The companies that sent a letter to fire their employees are going to have to change. In addition, there are issues of inclusion and non-discrimination against non-binary people and those who have a change of gender identity that must be reflected in the policies and regulations of the companies. In this same sense, reforms are coming where violence in the workplace will be considered almost anything and, additionally, companies will be forced to grant flexible hours in certain cases. All of these are issues that are not currently in the regulations of most companies and that will have to remain there”, pointed out an expert from BéndiksenLaw.
5. Formalization of companies
In the case of the formalization of companies, the reform contains a whole chapter on the legalization of digital platforms, agricultural work, formalization of employment for migrants, for professional athletes and for domestic workers.
6. Union strengthening
The strengthening of workers’ unions and unions will be much easier for employees. “With the reform, it will be much easier to form unions and it will be easier to go on strike. Additionally, there will be less opportunity for companies to declare strikes illegal. In this same sense, the repercussions for those who go on strike illegally will be less,” he said.
Finally, in the opinion of the BéndiksenLaw lawyers, the reform is nonsensical in that it does not oblige the public sector to comply with the aspects it proposes. “That the reform does not include the public sector, which is where the provision of services is most abused, is nonsense, so they squeeze companies, but the government continues to ignore all the labor principles it seeks,” said Sebastián bendiksen.
Only corporate responsibility?
The company specialist lawyer highlighted the value of the reform to guarantee the right to work. However, Béndiksen sees a problem in the fact that the government dumps this responsibility on companies and does not propose any type of support for a transition. “The reform has interesting aspects for the worker in terms of formalization because, above all, there is a lot of informal employment in Colombia. So, on that side, it seems good to me to seek the protection of workers, to formally bind them all by contract, but there is the problem that the entire burden of the reform falls precisely on the companies and no kind of subsidy is being created to support with formalization and then they leave the burden to the companies and for the SMEs, above all, it will be a huge burden,” he said.
The BéndiksenLaw lawyers called for companies to actively participate in the process of debating the standard. “The call is to be very attentive, this is missing the debates in congress, so that people be very attentive, that they write to the congressmen, that they keep an eye on the debates and that they exert social pressure on our representatives to that they are in the debates of this reform and do not hit the companies so hard”.