Work or Labor Contract in Colombia: Severance Pay and Labor Rights (2026)

I have realized that the project-based contract (contrato por obra o labor) is one of the most widely used models in Colombia, especially if you work in tech, marketing, or construction. But, honestly, it's also one of the most misunderstood. Many employers use it as an «extended probation period» or think they can fire you from one day to the next without paying severance. Watch out for that, because Colombian law is strict and, with the recent changes from the Labor Reform (Law 2466 of 2025), the rules of the game have changed.

Quick answer: A project-based contract guarantees the exact same rights to statutory benefits (cesantías, prima, vacations) as an open-ended (indefinite term) contract. The key difference is that it ends naturally when the specific project you were hired for is completed. If you are fired ahead of time without just cause, they have to pay you for the time remaining to finish the project, and that compensation can never be less than 15 days' salary. If you want to see real options right now, you can view available jobs on Colombia Move — posting is completely free.

If you are about to sign one of these contracts or your project has just ended, here I explain with updated figures for 2026 how your liquidation works and what you should demand.

What is a Project-Based Contract and What Changed with the Labor Reform?

According to Articles 45 and 46 of the Substantive Labor Code (CST), this is a fully fledged employment contract, not an informal agreement or a service provision contract (prestación de servicios). You are subordinated, you work fixed hours, and you receive a salary.

The most drastic change came with Law 2466 of 2025. Today, this contract must be mandatory in writing and must exhaustively detail what the specific work or task is. I would skip any company that offers you this contract «by word of mouth». If the contract is verbal, or if you keep working on other things after the original project is finished, the law automatically assumes you have an open-ended contract from the start of the employment relationship.

Rights and Liquidation: What are you entitled to receive?

Just because the contract is temporary doesn't mean your rights are. You are entitled to proportional payment of all your statutory benefits from day one. To make your calculations correctly, keep the official 2026 values in mind:

• Minimum Wage (SMMLV): COP 1,750,905.
• Transportation Allowance: COP 249,095 (included to calculate prima and cesantías if you earn up to 2 SMMLVs).
• Maximum Workday: Since July 15, 2026, the limit has definitively dropped to 42 hours per week. Any overtime is calculated based on this new cap.
• Surcharges: The nighttime surcharge (35%) now starts at 7:00 p.m., and the surcharge for working Sundays or holidays rose to 90% as of July 2026.

Your final liquidation must include pending salaries, cesantías, interest on cesantías (12% annually on the value of cesantías), the service bonus (prima de servicios), and unused vacations. If you have doubts about the exact math, I recommend reviewing our cesantías and labor liquidation guide to see step-by-step formulas.

Severance Pay for Dismissal Without Just Cause: The 15-Day Minimum Calculation

What happens if you were hired to develop an app that took six months, but in month two they tell you they no longer need you? If you didn't commit any serious misconduct, this is a dismissal without just cause.

Article 64 of the CST protects workers in this situation. The employer is obligated to pay you, as compensation, the salaries corresponding to the time left to finish the project. The most important thing here is the «minimum floor»: the compensation can never be less than 15 days' salary. Even if they fire you with only two days left to deliver the project, they have to pay you those full 15 days of compensation, in addition to your legal liquidation.

How to Legally Formalize New Projects

If you finish a project and the company wants to keep you for a different one, they can't just let you keep coming to the office. They must liquidate the previous contract and sign a new one, or make a written addendum (otrosí) that defines the new task down to the millimeter. If they don't do this, you automatically become an indefinite-term employee.

Changing projects or jumping into the freelance world often means you need to upgrade your work tools. According to active listings on Colombia Move (July 2026), there are currently 4 active computer listings and buyer demand for second-hand equipment outpaces supply. If you are going to renew your laptop for a new contract, it's an excellent time to sell your old equipment.

Frequently Asked Questions

❓ Does the project-based contract require advance notice to terminate?

No. When the work or project ends naturally, a 30-day legal notice is not required. However, if they terminate your contract before finishing the project and without just cause, they must pay you immediate compensation.

❓ What happens if my project-based contract was verbal?

Under Law 2466, if there is no written document detailing the specific work, the law automatically considers it an open-ended contract from the first day of your employment relationship.

❓ How is the compensation calculated if I am fired before finishing the project?

They must pay you the salaries corresponding to the time remaining to complete the project. The golden rule of Article 64 of the CST is that this payment can never be less than 15 days' salary.

❓ Am I entitled to a bonus (prima) and cesantías in a project-based contract?

Yes, absolutely. There are no exceptions; you accumulate all your statutory benefits (prima, cesantías, interest, and vacations) proportionally to the time you have worked, even if it's just one month.

❓ What happens if I keep working after the agreed project is finished?

If you continue providing your services without signing a new contract or a written annex detailing the new task, your contract instantly turns into an open-ended one.