Temporary reduction of the contribution rate to the public pension system and other measures

Constitutional Review of Presidential Decree 558 of 2020

Date:  07/23/2020

Judge-Rapporteur:  Antonio José Lizarazo Ocampo

Concurrence:  Alberto Rojas Ríos

Dissent:  Carlos Bernal Pulido (partial).  Luis Guillermo Guerrero Pérez.  Alejandro Linares Cantillo

Reviewed decree.  The decree, based upon the emergency due to the Covid-19 pandemic, allowed for two months (April and May, 2020) the reduction of the payment of the contributions to the public pension system up to a 97% of the usual amount.  Only 3% should be paid by both employers and employees.  Is also took protective actions for monthly payments of one of the legal retirement programs, i.e. the Programmed Retirement Scheme in charge of government agency Colpensiones. It finally allowed not to add up the two months in question for the purpose of the recognition of requirements for retirement to employees who earn more than the minimum wage.

Issue: Is it allowed to the President to take decisions on the pension system based on the emergency generated by the pandemic?

Ruling and reasoning.  No. The Court RULED THE UNCONSTITUTIONALITY of the entire decree due to non-compliance with two material requirements set out in the precedents for this type of exceptional regulations, i.e., i) the so called “non-specific contradiction requirement”, and ii) the absence of a link between the measures and the causes invoked thereof, the Covid’19 emergency. As to the first, the Chamber found three main faults in the decree: a) It unjustly impaired the right of employees who earn more than the minimum wage. b) It concedes the use of the pension’s financial resources for purposes other than those ordered by law.  c) And last, it did not guarantee the financial sustainability of the system. Regarding the second requirement, there is no logical relationship between the protective measures taken to solve a previously extant problem in Colpensiones regarding the Programmed Retirement Scheme, and the supervening situation occasioned by the pandemic.  The Court declared that this decision must be enforced immediately, affecting actions taken prior to its issuance.