Colombia Statutory and Private Employee Benefits, 2023 Update

Colombia Statutory and Private Employee Benefits, 2023 Update

Summary

The report provides in-depth industry analysis, information, and insights of the employee benefits in Colombia, including an overview of the state and compulsory benefits in Colombia, detailed information about the private benefits in Colombia, insights on various central institutions responsible for the administration of the different branches of social security and the regulatory framework of the employee benefits in Colombia.

Colombia has a basic social security system with low coverage and participation. The country’s social insurance system was initially introduced for public sector employee groups only. Private sector employees secured coverage in 1946. Pension benefits were introduced with the creation of the Social Security Institute (ISS) in 1967. However, the ISS faced problems immediately due to low coverage and participation rates. To overcome this problem, the government created a new social security system through Law 100 of 1993. The law introduced a dual public-private competitive pension system - Régimen de Prima Media or average premium scheme (RPM), and the Régimen de Ahorro individual con Solidaridad, or individual savings system with solidarity (RAIS). In 2012, the administration of RPM was transferred from ISS to Colpensiones, a state-owned financial institution supervised by the Ministry of Labor, due to problems with debt and inefficiency. Private sector employees can choose between RPM and RAIS and have the option to change their membership once every five years. For self-employed and unemployed individuals there is a voluntary regime. Armed forces, police, and teachers have their separate systems.

Key Highlights

• The general protection system in Colombia consists of a system of social security and welfare
• The Colombian social security system offers contributory and non-contributory benefits to vulnerable people in society
• A person’s national insurance contribution is determined based on their income.
• An insured person who is unemployed or unable to work and whose benefits have been exhausted is entitled to credited contribution.
• In Colombia, employers provide voluntary retirement benefits to their employees through trust companies, insurance companies, and Administradoras de Fondos de Pensiones (AFP)

Scope

This report provides a detailed analysis of employee benefits in Colombia -

• It offers a detailed analysis of the key government-sponsored employee benefits, along with private benefits
• It covers an exhaustive list of employee benefits, including retirement benefits, death in service, long-term disability benefits, medical benefits, workmen's compensation insurance, maternity and paternity benefits, family benefits, unemployment benefit, leaves and holidays and private benefits
• It highlights the economic and regulatory situations relating to employee benefits in Colombia

Reasons to Buy

• Make strategic decisions using in-depth information related to employee benefits in the country
• Assess employee benefits of the market, including state and compulsory benefits and private benefits
• Gain insights into the key employee benefit schemes offered by private employers in the country
• Gain insights into key organizations governing employee benefits market, and their impact on companies