HIRE PENSION LAWYERS COLOMBIA IMMEDIATELY!!
If you are wondering about how the pension system works in Colombia, you should be informed that the system in Colombia has not always been as it is now. Until the year 1993, the system followed for pension was different, say lawyers in Colombia. In 1993, the need for change was realized and reform was carried out. Changes were made to the existing system to provide employees with a well-organized pension system. Before these changes, the system in Colombia was not organized and was managed in different units. Lawyers representing pension cases today will inform you that the system existing in those days was such that more than 1000 providers existed and the system had mostly pay-as-you-go schemes involving public workers too. Lawyers in Colombia believe that the previous system was complicated due to the different regulations and procedures that applied to each system including the benefits applicable to each system. The need to follow different procedures made it burdensome for employers in Colombia to follow these procedures. If you are an employer planning to begin a business in Colombia you will be glad to know from our lawyers that this complicated system has changed. The Colombian General Pension System focusing chiefly on formal sector workers has replaced all the previous systems, say lawyers. However, the law allowed certain public sector benefit schemes to be retained such as the military or police.
All That You Should Know About The Pension Scheme In Colombia
Your lawyer will apprise you that the pension scheme in Colombia comprises of two schemes that are the public scheme and the private scheme. Both these systems have different procedures, requirements, and benefits, say lawyers. The adept lawyer will explain the requirements under existing law. The law in Colombia requires anyone benefiting from insurance to pay to either the public or private pension scheme. The individual is free to change from private to public and vice versa every five years. However, your lawyer will forewarn you that the individual expected to retire in the next 10 years cannot change membership in Colombia.
Individuals planning to change pension types often question lawyers as to what happens to the amount accumulated in the fund during the membership period. Experienced lawyers in Colombia will inform that if an individual is moving from a private plan to a public plan the accumulated funds are calculated as per the week calculation in the public scheme. Similarly, if an individual is moving from a public scheme to a private pension scheme, then a pension bond is issued, say lawyers in Colombia.
Your lawyer will elucidate that one of the basic criteria to be followed for the calculation of pension bonds in Colombia is the anticipated salary that an individual will receive at the time of retirement and the accumulated contribution weeks. Be warned by your lawyer that you become eligible to receive these pension bonds only if there is proof that you have contributed for one hundred and fifty weeks.
The public pension scheme in Colombia is a distinct scheme where the beneficiaries are paid as and when they become due. Another important aspect of the pension scheme in Colombia is the Mayor Programme in Colombia. Under this scheme, payment of subsidy is offered to old people living in poor economic conditions in Colombia, say lawyers. In addition to this scheme, the Mayor Programme in Colombia supports the payment of subsidies for economically deprived employees who fail to become eligible for being a beneficiary of the General Pension Scheme in Colombia.
Your lawyer will clarify that in both the private and the public pension schemes in Colombia, the state plays a crucial role and guarantees the process. Your lawyer will inform you that the private scheme is a specifically funded scheme. As part of its role in guaranteeing support to the beneficiaries, the state provides additional support for those workers in Colombia who are financially unable to contribute to the minimum pension requirements under the law, say lawyers. However, to enjoy this additional support, the worker has to fulfill certain requirements imposed by law.
Skilled lawyers will describe that the Voluntary Pension Scheme benefits are offered to the lowest income group too. The main condition to enjoy benefits under this scheme is that the individual should be affiliated to either a public or private component of the general pension scheme. Your lawyer will explain that all individuals can contribute. However, the law requires the individual to contribute to the system for at least five years. Your lawyer will notify you that the pension scheme in Colombia allows you to withdraw from accumulated funds even in the five years period if the withdrawal is for a justified cause such as retirement, illness, or demise. Also, if the individual is making the withdrawal for the purchase of a home the law permits such withdrawals. To know more about such withdrawals from pension schemes in Colombia, consult an experienced lawyer.
General information about contributions made
Your lawyer will describe that the extent of contributions made by employer and employee is a vital part of the pension scheme information. Foreign companies already established in Colombia or planning to expand in Colombia should mandatorily know crucial details of the contributions made by the employer and employees. Labor law requirements are to be strictly followed in Colombia. Consult a lawyer to know how to abide by the legal obligations.
The lawyers you consult will assert that in order to ensure security for the employees the law requires employers to contribute to the pension of the employees. The contributions made by employers and employees vary. Your lawyer will elucidate that the employer contributes 12 percent and the employee contributes 4 percent of the benefit value. The strict requirement for employers to contribute to the pension of employees is to guarantee the employee minimum monetary allowances after he retires from the job, say lawyers. This duty to contribute to the pension of employees applies to domestic business companies and foreign companies alike. Foreign companies planning to start a business in Colombia should make sufficient inquiries of the law of the land in Colombia about what is their duty as an employer to contribute for employee’s benefit.
The employee in a company in Colombia is a customer for another company, say lawyers. If the employee has to maintain the same purchasing power after retirement, he should be guaranteed some source of income in Colombia. Pension is the most desirable form of source of income for employees, emphasize lawyers. The adept lawyers will also update you that employees who belong to the higher income group can contribute an additional 2 percent than what is generally required and should contribute to the solidarity pension funds.
When can an employee reap the benefits of the plan?
On contributing continuously to the plan, the employee is always eager to know, when he will begin receiving the pension. Ask your lawyer about who is eligible to become a beneficiary under the public pension scheme in Colombia. The law clearly mentions who is eligible and who is not. If the beneficiary is a male, then he should have completed 25 years of service and the age should be 62 years to avail of the benefit. If the beneficiary is female, then she should have completed 25 years of service and the age should be 57 years.
If you are an independent person not belonging to any private or public undertaking in Colombia, then do not feel scared about your future. The law provides special provisions for persons in categories such as you. You are required under law to pay sixteen percent of the forty percent of your total income into the fund in Colombia. This way you can secure your future. If you are independent but are not affluent enough to pay the required sixteen percent of the forty percent of the income to the fund, then the law offers you special benefits. The law provides a subsidy for such economically lower-income groups, say lawyers.
What happens to the pension during a business transfer?
Employees are usually worried when another business undertaking acquires their current employer’s business. They should not worry about losing their benefits. A discussion with your lawyer about the reason for the funds to remain intact is that these pension funds remain in the name of the employee and not the employer.
The next question tormenting employees is that what happens to pension funds when the company becomes insolvent. Your lawyer will clearly explain that the insolvency of your company does not change the status of the funds. The pension funds account is separately maintained and if the employer becomes insolvent after the transfer of his contribution is made, nothing changes. However, if the contribution is yet to be transferred then such transfer may not be made. The employee still has the right to make a claim for his pending contributions.
If you require more information about the compliance for employee pension in Colombia is concerned, you should contact the lawyers at The Law Offices Of SRIS, P.C.