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 used models in Colombia, especially if you work in technology, marketing, or construction. But honestly, it is also one of the most misunderstood. Many employers use it as an "extended probationary period" or believe they can fire you from one day to the next without paying a severance settlement. Be careful with that, because Colombian law is strict and, with the recent changes in the Labor Reform (Law 2466 of 2025), the rules of the game are different.

Quick answer: A project-based contract guarantees exactly the same rights to social benefits (severance, service bonuses, vacations) as an indefinite-term contract. The key difference is that it ends naturally when the specific project for which you were hired finishes. If you are fired ahead of time without just cause, they have to pay you for the time remaining to finish the work, and that compensation can never be less than 15 days of salary. If you want to see real options right now, you can see 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 values updated to 2026 how your settlement works and what you should demand.

What is the 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 full-fledged labor contract, not an informal agreement or a service provision contract. You are subordinate, you keep a schedule, and you receive a salary.

The most drastic change came with Law 2466 of 2025. Today, this contract must be in writing and must detail exhaustively what the specific work or project is. I would skip any company that offers you this contract "verbally." If the contract is verbal, or if you continue working on other things after the original project ended, the law automatically assumes you have an indefinite-term contract from the start of the working relationship.

Rights and Settlement: What are you entitled to receive?

Just because the contract is temporary does not mean your rights are. You have the right to proportional payment of all your social benefits from day one. To get your math right, keep in mind the official 2026 values:

• Minimum Wage (SMMLV): COP 1,750,905.
• Transportation Subsidy: COP 249,095 (included to calculate the service bonus and severance if you earn up to 2 minimum wages).
• Maximum Working Hours: Since July 15, 2026, the limit dropped permanently to 42 hours per week. Any overtime is calculated based on this new cap.
• Surcharges: The night surcharge (35%) now begins at 7:00 p.m., and the surcharge for working Sundays or holidays rose to 90% as of July 2026.

Your final settlement must include pending salaries, severance, interest on severance (12% annually on the severance value), the service bonus, and unused vacations. If you have questions about the exact math, I recommend checking our severance and labor settlement guide to see the step-by-step formulas.

Compensation for Unjust Dismissal: The Calculation of the 15-Day Minimum

What happens if you were hired to develop an app that took six months, but in month two they tell you they don't need you anymore? If you did not 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 work. The most important thing here is the "minimum floor": the compensation can never be lower than 15 days of salary. Even if you are fired with only two days left to deliver the project, they must pay you those full 15 days of compensation, in addition to your legal settlement.

How to Formalize New Projects Legally

If you finish a project and the company wants to keep you for a different one, they cannot simply let you keep coming to the office. They must settle the previous contract and sign a new one, or make a written addendum that defines the new task precisely. If they do not, you 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 ads on Colombia Move (July 2026), there are currently 4 active listings for computers and the demand from buyers looking for second-hand equipment exceeds the supply. If you are going to renew your laptop for a new contract, it is an excellent time to sell your old equipment.

Frequently asked questions

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

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

❓ What if my project-based contract was verbal?

Under Law 2466, if there is no written document detailing the specific task, the law automatically considers it an indefinite-term contract from the first day of your working relationship.

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

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

❓ Do I have the right to a service bonus and severance in a project-based contract?

Yes, absolutely. There are no exceptions; you accumulate all your social benefits (bonus, severance, interest, and vacations) proportionally to the time you have worked, even if it is only a month.

❓ What happens if I continue working after the agreed project has ended?

If you continue providing your services without signing a new contract or a written annex detailing the new task, your contract instantly becomes an indefinite-term one.