Colombia’s Senate Approves Labor Reform That Changes Work Rules and Costs

Colombia’s Senate approved an important labor reform bill on June 18, 2025. The bill now only needs final approval and the president’s signature to become law.

This reform, pushed by President Gustavo Petro, aims to update work rules that have not changed much in years. The new law limits the workday to eight hours and the workweek to 42 hours.

It also changes when night shift pay starts, moving it earlier to 7 p.m. This means workers who start late shifts will get extra pay sooner. The law increases pay for work on Sundays and holidays from 75% extra to 100% extra by 2027.

These changes will raise costs for companies that rely on night and weekend workers. The reform also makes it harder for companies to use temporary or outsourcing contracts.

It encourages hiring workers with permanent contracts, which means businesses will have to pay more in benefits and severance. Gig economy workers, like delivery drivers, must now pay social security and cannot be forced to work only for one company.

The law also requires human control over any algorithms that manage gig workers. Experts say these changes could increase labor costs by between 7% and 35%, depending on the industry.

This will affect how businesses manage their staff and budgets. Companies will need to adjust quickly to follow the new rules. The government says the reform will create better jobs and reduce inequality.

Colombia’s Labor Reform Sparks Job Hopes

Labor Minister Antonio Sanguino says the law could generate 91,000 new jobs each year. The government argues the reform fixes past problems where workers had to work longer hours without fair pay.

However, critics warn the reform could make hiring more expensive and difficult, especially for small businesses. They worry higher costs might reduce job creation or push companies to operate informally.

There is also political debate over a referendum President Petro wants to hold on the reform. The Senate rejected this referendum, but the president insists it remains valid until the law is finalized.

This labor reform will change Colombia’s work environment and business costs. It aims to protect workers but will require companies to adapt to new rules and expenses. The final impact will shape Colombia’s economy and labor market for years ahead.