A recurring theme that arouses a lot of interest in Colombian workers is the one referring to severance pay and their payment. To define and explain what this benefit that people who are formally linked to work have consists of, it is necessary to refer to Law 50 of 1990, which stipulates that the value of severance pay is settled annually on December 31 and they are deposited in a Severance Fund before February 15 of the following year.
Layoffs are a legal benefit and benefit that a company or employer must pay to its workers, apart from the ordinary salary. This amount is equivalent to one month’s salary for each year worked by the employee.
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It should be noted that the money corresponding to this benefit is very useful in case the beneficiary becomes unemployed or also if they want to access housing or education. Not a minor fact is that before the end of the year, workers can choose in which severance fund they want them to deposit this money; It can be a private or public fund, according to the holder’s preference.
A question that also arises constantly is: at the end of a contractual relationship between a person and a company, are severance payments lost? The answer to this question is that there is no loss of severance pay in case of dismissal or resignation; layoffs will always belong to the worker. If required, in the event that a person is unemployed, he must present the letter of separation from the company before the fund to which he is affiliated and make the respective withdrawal.
The workers who have the right to receive severance pay are those who are dependent or independent. In the case of the latter, saving is voluntary, since they are not required to join a Severance Fund.