Termination of Employment by Mutual Agreement: What Does It Entail?

Article 61 of the Substantive Labor Code allows employment contracts to be terminated “by mutual consent.” This mechanism is particularly significant when the employee has enhanced job stability due to health-related reasons.

It is worth noting that one way mutual consent can be formalized is through a settlement agreement or conciliation, as these tools explicitly establish that the parties will not pursue any judicial proceedings.

The Supreme Court of Justice, in its recent ruling SL-1797 of 2024, stated that conciliation is a valid method for terminating an employment contract, provided the employee’s consent is free of any defects or coercion.

As a result, if an employee demands reinstatement based on health-related job protection after signing a settlement agreement or a conciliation agreement, the employer may invoke exceptions such as res judicata, settlement, and conciliation to prevent the claim from succeeding, as the signed agreement holds full validity.

Can a Person with Disabilities Agree to Terminate Their Employment?

In the case reviewed by the Supreme Court of Justice, the claimant argued that they had medical recommendations and restrictions, suffered from an occupational disease, and had multiple periods of work incapacity.

However, Justice Marjorie Zúñiga Romero clarified that no discriminatory intent is presumed when an employee voluntarily agrees to terminate the employment relationship through a legally recognized method, such as conciliation under Law 640 of 2001.

Additionally, the Supreme Court emphasized that employees with disabilities “have full capacity to agree to the termination of their employment contracts under the same conditions as others,” thus recognizing the validity of such agreements and the legal capacity of individuals with disabilities to assume rights and obligations.

It is also important to mention that the labor court highlighted that rights derived from job stability are uncertain and debatable, meaning they can be subject to settlement and conciliation.

Consequently, the court upheld the validity of termination by mutual agreement, ruling out the possibility of reinstatement. The court concluded that transactional agreements are permissible for ending employment contracts for individuals with enhanced job stability due to health conditions.

Do not hesitate to contact Brick Abogados if you have any concerns or if you would like more information on the topic discussed above.

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This document is for informational purposes only and does not constitute legal advice, nor does it engage the responsibility or professional opinion of Brick Abogados.