Deadline for payment of severance pay
Within the annual severance payment system created by Law 50 of 1990, every employer has the obligation to make on December 31 of each year, a definitive settlement of the severance payments in favor of its employees, as expressly provided for in numeral 1 of Article 99 of the aforementioned law.
Said allowance corresponds to one month's salary for a full year of work or proportionally for a fraction of an annuity and must be liquidated taking "as a basis the last monthly salary earned by the worker, provided that it has not had any variation in the last three (3) months. Otherwise, and in the case of variable salaries, the average of the salary earned in the last year of service or in all the time served if it is less than one year shall be taken as the basis" [1].
In turn, it should be noted that employers may not withhold such money that is liquidated as severance pay, but, according to the provisions of paragraph 3 of Article 99 of Law 50 of 1990, they must proceed to deposit it before February 15 of the year following its liquidation in an individual account in the name of the worker, linked to the severance fund to which he/she is registered.
It is important to point out that, as indicated in the final part of paragraph 3 of the article described above, employers who fail to comply with such term must pay to their employees, as a penalty, one day's salary for each day of delay in the deposit of severance payments in the fund.
Based on the above and as it must be done every year, employers must make no later than February 14 of the current year, the payment of severance payments in favor of workers who, as of December 31, 2018, were linked to their services.
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