Employers in Colombia have a deadline to consign their workers no later than January 31 the interest of the layoffs corresponding to the year 2022.

This is provided by numeral 2 of article 1 of law 52 of 1975, which establishes that this interest will be 12 percent per year of the total value of layoffs or proportional to the time worked for those who do not complete a full year of work.

Note that Layoffs are a social benefit to which every worker with a labor relationship is entitled, and corresponds to one month’s salary for each year of service provided.

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To understand how paying for these resources works, the Future Pension and Severance Fund Clarifies the most frequently asked questions:

Who should pay them?

Severance pay interest must be paid by the worker directly or deposited into the worker’s account and will be defined as savings to cover the expenses that the month of January brings.

From when can you pay and what is the maximum term?

By legal mandate, interest on layoffs must be paid no later than January 31 of the year following the claim of layoffs, however, for events in which the employment contract is terminated prior to the end of the years Interest on layoffs must be paid proportionally to the time worked at the time the employment contract ends.

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How much is this payment?

To find out how much you should be paid for severance interest, the first thing you need to know is the total base or the accumulated balance of the layoffs you have.

For example, if the layoffs of a worker who worked throughout the year correspond to $3,000,000 the value ofThe severance interest will be $360,000, the result of applying the following formula:

– Severance interest = _days worked X 0.12 X Monthly Salary____
360 days

– Severance interest = __360 x 0.12 x 3’0000.000____
360 days

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Are Severance Interests consigned to the Severance Fund?

No, these resources are delivered directly to the worker before January 31 of each year, if the entire year was worked or at the time of termination of the employment contract.

Unlike severance pay, which must be deposited between January 1 and February 14, to the Severance Fund chosen by the worker, which constitutes savings at times when the worker is unemployed.

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Who benefits from severance interest in Colombia?

These interests benefit all people in Colombia who have a labor relationship with fixed-term or indefinite-term contracts, in addition, also domestic employees. According to the most recent labor market indicators delivered by DANE (July-September quarter), In Colombia there are 10.7 million workers who have a formal job.

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