Pension
In Ghana, the National Pension Act was implemented in 2010 to establish a uniform set of rules and standards for the administration and payment of retirement and related benefits for workers. Employers must register all their employees in the scheme. There is also a voluntary pension scheme.
An employee qualifies for an old-age pension at age 60 with at least 180 months (15 years) of contributions (age 55 for persons working under hazardous conditions). An early (reduced) pension is permitted at age 55 with at least 180 months of contributions. The old-age pension is not payable abroad.
The pension amount is calculated as 2.5% of average monthly income for each or the first 15 years of contribution is rated 2.5%. The subsequent years attract a yearly rate of 1.125%, limited to a maximum of 60% of the average monthly income.
Dependents/Survivors Benefits
A survivors benefit is paid as a lump sum to survivors nominated by the deceased person if the deceased was younger than age 75 at the time of death. Eligible survivors include a widow(er), orphans, parents, and certain other family members. The survivors must have been partially or fully dependent on the deceased.
If the deceased had paid 12 contributions within the last 36 months prior to their death, a lump sum payment of the earned pension of the deceased member for a period of 15 years will be paid. The present value of the pension is calculated using the 91-day Treasury bill interest rate or 10%, whichever is lower. When the death of the member occurs before making the 12 months contribution within the last 36 months, a lump sum equal to their total contributions and interest at the rate of 75% of government Treasury bill rate, will be paid.
If an employee dies as the result of a workplace injury or occupational disease, a lump sum of 60 months of the employee’s earnings when the work injury occurred or occupational disease began is paid, minus the value of any disability benefits paid for the same work injury or occupational disease before the deceased’s death.
Invalidity Benefits
To qualify for invalidity pension, the employee must have contributed for 12 months in aggregate within the last 36 months preceding the incidence of the invalidity. Employees who do not meet the qualifications for an invalidity pension may be entitled to a disability benefit (mandatory occupational pension).
An employee who qualifies for an invalidity pension will receive 37.5% of their average annual earnings in the three highest years of earnings plus 1.125% of average annual earnings for each month of contributions exceeding 180 months.
In the case of occupational injuries, the employer must provide benefits directly to employees or purchase private insurance to cover these costs.