Termination Settlement Calculator – My Calculator

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Termination Settlement Calculator. The Ministry of Labor presents the Labor Calculator. An easy-to-use educational tool, with which all workers and employers in Colombia will be able to:

  • Generate estimates of settlement of social benefits
  • Simulate the monthly provisions that employers must take into account when hiring a worker.

Instructions My Calculator

  1. If you want to calculate your settlement, enter the start and end date of your contract or employment relationship using the calendar. Please note that the estimated settlements and costs are calculated per calendar year.
  2. Enter the value of the salary.

Important:

  • Settlements are calculated and made year after year. The Calculator does not allow entering periods that exceed the calendar year.
  • Remember to indicate whether or not you receive transportation assistance. Workers who earn more than two minimum wages are not entitled to transportation assistance.
  • The salary earned cannot be less than the Minimum Salary.

Terms of use Termination Settlement Calculator

Restrictions:

This tool is valid for all workers in the private sector linked to a direct employment contract.

Does not apply to:

  • Public servers
  • Workers bound by a contract for the provision of civil services.
  • The Workers who receive a full salary, that is, more than 10 minimum salaries, plus a benefit factor equivalent to 30% of the salary received, in which case only paid rest is settled.
  • Workers NOT covered by Law 50 of 1990, who are entitled to retroactive severance pay.

This calculator only applies to simulate liquidations in the events in which the employment contract ends with just cause or for any of the legal causes that do NOT give rise to compensation of any kind.

Remember: when there is a conflict regarding the rights of the worker, you must go to the ordinary labor court.

Termination Settlement Calculator

At the time of a job exit, doubts can be generated such as not knowing if you should receive a settlement or liquidation, how much is received and the obligations and rights that you must have when leaving a company, it is because That is why we will explain the difference between settlement and liquidation and how to calculate the liquidation. Although a simulator or a settlement calculator can be found on the internet, but you must know some data to be able to capture the information and it will give an approximate result of what you should receive from the company.   

What is settlement?

The labor liquidation is simple: compensation. In other words, when we talk about a liquidation, it is a monetary compensation that any company must make at the time the worker loses his job, with some conditions involved.

The liquidation occurs when the boss has no way to justify the fault or responsibility of the worker in making the decision to replace him in his position. The settlement can be said to compensate for the damage caused to the worker by the loss of his job. This taking into account that it affects his quality of life and that of his family.

How do you know if you are entitled to a settlement or liquidation?

As you may know, the settlement corresponds when the employee and the employer voluntarily terminate an employment relationship, it can be paid by check but for the employee to receive the money, he must formally deliver a “Settlement Letter” so the employer returns another letter including data and breaking down the concepts that will be paid.

A Termination Settlement Calculator is yours if:

  • You are voluntarily resigning
  • The temporary contract ends or concludes a specific period for which you were hired
  • They fire you regardless of whether it was justified or not
  • You terminate your contract due to an offense committed
  • due to sickness disability
  • employee death

On the other hand, a liquidation or indemnity applies when:

  • The company terminated the contract for reasons unrelated to your performance
  • Closure of company or elimination of your position
  • unfair dismissal
  • If you resign because of a serious fault committed by the employer

When is the settlement paid?

According to what is established in the Federal Labor Law, the reasons for terminating any employment relationship with a worker, by unilateral decision of the boss, must be stipulated in article 47 of the law. All this so that the dismissal does not have responsibility for the employer. 

These are some reasons for dismissal:

  • False documentation to certify skills required by the position held
  • More than 3 days of absence from work in a month without justification or permission
  • Incurring acts of violence, harassment or sexual harassment against any member within the company
  • Endanger the establishment or the people present in the company
  • Reporting to work intoxicated or under the influence of any illegal substance

In any of the above cases, the company has the right to dismiss the worker without having to pay the settlement. 

Now, if the reason for the dismissal is not stipulated in article 47, then the worker has the right to demand payment of the settlement for unjustified dismissal.

Additionally, article 51 of the Federal Labor Law stipulates other reasons:

  • There is a deception by the boss regarding working conditions
  • There are acts of violence, harassment and/or sexual harassment, mistreatment against the worker
  • Decrease the worker’s salary
  • Employees do not receive the salary that corresponds to what was agreed
  • There is danger to the safety or health of the worker or his family
  • Acts where the boss puts the safety of the establishment and people at risk 

How to calculate the settlement? 

If you want to calculate the settlement, it is important to know the composition of the amount to be paid. It is important to mention that the settlement consists of the payment of compensation and the payment of a seniority premium.

Additionally, the proportional parts of Christmas bonus and vacation premium must be added to the amount. Unlike the settlement payment, it is that the amounts must be added to the daily salary.

  • Compensation: This is the payment of 3 months of salary, added to 20 days of salary for each year that the worker provided a subordinate personal job in the company
  • Seniority premium: When it comes to liquidation, this concept will always be included. The seniority premium corresponds to the payment of 12 days of salary for each year worked in the company
  • Proportional benefits. It is known as the equivalent of the proportional parts of Christmas bonus and vacation bonus. 

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