Author: Sebastián Béndiksen

Heirs must assume the payment of labor obligations

Following a request by a domestic worker whose deceased employer owed her labor obligations, the Ministry of Labor issued a legal opinion touching on several significant issues to consider when an employer dies. This is especially relevant in legal probate processes.

First, the entity declared that the death of an employer is not a valid cause to terminate labor contracts. Second, labor obligations are liabilities of the estate that is the subject of the probate process. This means that people entitled by law to inherit from a certain person must assume the deceased’s payments.

Thus, if an employer dies, the labor contract is not terminated due to that circumstance. Additionally, all labor obligations, including salary and social security payments are part of the probate processes. Therefore, heirs must assume said amounts.

The Colombian Superintendency of Corporations Changed its Posture Regarding Cryptocurrencies

Cryptocurrencies transformed the traditional scheme of commerce as a disruptive innovation to economic operators. Faced with this phenomenon, the Colombian Superintendency of Corporations, following the Bank of the Republic’s opinion, has always emphasized the impossibility of executing commercial operations with them.

Previously, in an opinion issued in August 2020 the Colombian administrative authority sustained the illegality of making capital contributions to corporations with cryptocurrencies. The reasonings were the enforced circulation of cash and the Colombian peso as only legal tender in the country.

Nevertheless, this changed. In a legal opinion of December 2020, the Colombian Superintendency of Corporations stated that is indeed possible to make capital contributions to corporations with cryptocurrencies. This taking into account that commercial law allows shareholders to make capital contributions with assets other than cash.

Therefore, cryptocurrencies can now be used to make capital contributions to corporations, as long as, they are understood as assets with an economic value fixed by an appraisal approved by the partners, shareholders or the board of directors.

Retailers must offer legal reasoning when refusing a consumer’s right of withdrawal

E-commerce is growing exponentially and with it infringements on consumers’ rights. Deciding a lawsuit where a retailer refused a customer’s right of withdrawal with no motivation, the Colombian Superintendence of Industry and Commerce stated that retailers must legally justify their refusal to a customer’s right of withdrawal.

The right of withdrawal is the possibility that consumers have to back out of a sale contract. It is established in either of the following cases: (i) The sale is made directly with the retailer’s financing systems, (ii) Timeshare sales, (iii) The sale is not made with traditional methods of acquisitions (e.g. sales from home or office); or (iv) In “distance sales” where the consumer does not have prior physical interaction with the product.

Therefore, when consumers decide to back out of a sale contract, retailers must accept it or refuse their request but said reply must be supported by reasoning of legal origin.

Scope of the legal institution of “enhanced stability” is extended

The Constitutional Court of Colombia stated that the legal institution of “enhanced stability” is not limited to workers with disabilities but instead also includes workers who have a temporary leave of absence mandated by their treating medical professional. This is especially important when employers are planning to dismiss a certain person.

The legal institution of “enhanced stability” it is established when: (i) the worker suffers from a health condition that impedes or substantially hinders the performance of his or her duties under regular circumstances; (ii) the employer has prior knowledge of said health condition before dismissal and (iii) there is a lack of sufficient legal reason for unilateral termination, which if undertaken would result in discrimination.

Therefore, when employers decide to dismiss a person who has a medical leave of absence, they must previously notify the Ministry of Health and Social Protection to obtain its authorization. Otherwise, unilateral termination would be illegal.

Labor lawsuits and Apartment Buildings

When workers in an employment relationship have disagreements with apartment buildings as their employers, lawsuits must be filed against the legal entity that is the building (as established in the “Horizontal Property Regime” in Colombia), stated the Supreme Court of Justice of Colombia. These claims, therefore, will be directed against a legal entity that is different from the individuals who are owners of the apartments.

This clarification from the Court is of special importance since there was some confusion as to who had to fulfill said labor obligations. Since buildings under “Horizontal Property Regimes” constitute an independent legal entity with its own rights and obligations, it is therefore called to appear in court and defend itself in judicial processes.

Electronic invoices of sales must be digitally signed by the biller to be valid as securities

Due to the massive digital transformation that took place on 2020, The National Tax Administration “DIAN” clarified that for electronic invoices to be valid as securities they must be digitally signed by the biller, as well as meet all additional requirements established in the Colombian Commercial Code and the Colombian Tax Statute.

When generating an invoice, the issuer must digitally sign it in accordance with Resolution No. 00050 of 2016, in order to guarantee its authenticity, integrity, and non-rejection. The issuer may use specialized software or use the DIAN’s free web platform.

The importance of electronic invoices being valid as securities lies in that individuals involved in the transaction have legal remedies for the fulfilment of all obligations contained in them. Additionally, taxpayers may use them as evidence of their income and expenditures.

Additional benefits in law that extends the Covid-19 relief for employers

The Colombian President signed into law an extension to the Formal Employment Support Program (PAEF in Spanish) until March 2021 and includes worker cooperatives in the program. Companies affected in their income by at least 20% due to the Covid-19 pandemic may opt for a benefit to receive 40% of a monthly minimum wage per employee. This new rule creates a total of seven additional payments, distributed between September, October, November and December of this year and January, February and March of next year.

This law includes trusts as potential beneficiaries of the programs. They do not have to comply with the requirement of being enrolled in the Commercial Registry. Instead, they simply need to have a valid tax ID and be an income tax payer. In addition, companies benefiting from this program will get additional contributions depending on the number of women employed.

The Legal Bonus Payment Support Program (PAP in Spanish) was also extended, in which the Government will make a 50% contribution to the payment of legal bonuses in December of this year to employees earning up to one million pesos.

Preventive isolation for workers with Covid-19 symptoms is not considered occupational disability

According to an opinion by the Ministry of Labor, workers who have symptoms of Covid-19 must isolate themselves preventively for a period of 14 days, however this is not considered occupational disability. At this stage, there are no payments for additional benefits and the worker must agree beforehand with the employer on the mode of labor, either work-from-home or telework. Each employer is responsible for taking the necessary measures to address the situation and it will be the responsibility of the teleworker to comply with them.

If the illness is confirmed, the appropriate entities must assume the appropriate payments. If the illness is of a common origin then the Health Insurance is responsible, if instead, its origin is work-related, the Workers’ Compensation Insurance is responsible.

Coughing, fever and shortness of breath are major symptoms of Covid-19, which is why measures were taken which both public and private entities are encouraged to implement; authorization of telework, adopting flexible schedules to reduce the risk of exposure at rush hour and avoid the concentration of workers in their workspace in order to have better air circulation, decreasing the number of face-to-face meetings and avoiding places with a large amounts of people where interactions with infected people can occur.

Labor benefits acquired through collective agreements can be modified due to the current health emergency

The Ministry of Labor clarified in an opinion that employers must pay the value of the transportation assistance as a digital connectivity assistance to any private or public sector workers earning up to two legal minimum wages.

In addition, it stated that collective agreements between employers, workers and trade union organizations are binding for all parties and must therefore be fully implemented by all parties. These agreements may be amended by the parties to agree to temporary changes regarding acquired benefits , with the aim of maintaining and protecting employment during the current health emergency in our country.

Constitutional Court declares that limits to when an individual can benefit from tax refunds is unconstitutional

The Constitutional Court declared that part of Article 1 of Decree 807 of 2020 that limits the term for taxpayers to be able to benefit from tax refunds or compensation through an abbreviated procedure is unconstitutional.

The Court stated that the establishment of a June 19, 2020 limit was not justified in the explanatory section of the decree nor in later interventions made by the Government.