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Colombia: Constitutional Court rules on Basic Contribution Income for Self-Employed Workers

Author: Angélica Carrión

On 19 February 2020, by ruling C-068, the Constitutional Court declared the unenforceability of article 244 of Law 1955 of 2019, which unified the Basic Contribution Income (BCI) for self-employed workers with and without a contract for the provision of services. For the Court, the regulation violated the principle of unity of matter with the law of which it was a part. However, as it understood that the effects of this decision could affect legal security and, in general, the social security system, the Court decided to defer its decision for two (2) legislatures. Just recently, on 21 June, the aforementioned term expired, and we do not have a law that the contribution base for self-employed workers with or without a contract for the provision of services. As a result, on 2 August 2022, the three (3) Ministries that could be understood to be involved in the issue (Finance and Public Credit, Labour, and Health and Social Protection) submitted to the technical director of UGPP a unified concept referring to Independent Contributions – Unenforceability Art. 244 Law 1955 of 2019.

In context, the general theory of the reviviscency of laws, as the possibility of “revive” regulations that have been excluded from the legal order, it does not apply automatically, and certain requirements must be met to ensure the necessity of the measure and the supremacy of the Constitution.

Moreover, the Ministries conclude that the Ineffectiveness of Article 244 of Law 1955 of 2019 implies that the norms prior to its issuance should be allowed to be reincorporated into the legal system, highlighting article 18 from Law 1122 of 2007 about the BCI of “self-employed workers”.

The Ministries also point out, regarding the monthly contribution due, that this has been a compulsory regulation since 1 October 2018, in accordance with the provisions of the first paragraph of Article 3.3.2 of the Decree 780 of 2016.

To this extent, a gap is left for capital investors and other self-employed (non-contractors), and for whom there is currently a whole system of presumption of costs, which, it would seem, has been left without a normative floor and which the Ministries do not analyse in their concept.

Key Action Points for Human Resources and In-house Counsel

As can be seen from the unified concept, it concludes with an understanding of the BCI reviving Law 1122 of 2007 for health, leaving the other regulations mentioned in force, so that the BCI to social security for contractors would continue to be 40% of the gross monthly value of the contract, paid monthly in arrears.