COUNTRY

Written Agreements

The Labour Act in Ghana requires written contracts of employment for people employed for a period of 6 months or more or a number of working days equivalent to 6 months or more within a year. A contract of employment is to express in clear terms the rights and obligations of the parties involved. Employers must, within 2 months after the commencement of employment, provide the employee with a written statement of the main terms of the employment contract, including names of parties, date of the first appointment, job title, pay (including overtime rates), hours of work, holidays, sickness and work-related injury entitlements, social security or pension scheme enrollment, termination notice periods, disciplinary rules, and grievance procedures.

Oral Agreements

Employment contracts can be express or implied. The Contracts Act states that no contract is void or unenforceable by reason only that it is not in writing or that there is no memorandum or note thereof in writing.

Under the Labour Act, a written agreement for employment relationships shorter than 6 months is not required. They can be made orally. However, within 2 months of commencing employment, the employer must provide the employee with a written statement of the main terms of the employment contract unless they are employing a casual worker.

Implied Agreements

In Ghana, employment contracts can be express or implied. The Contracts Act states that no contract is void or unenforceable by reason only that it is not in writing or that there is no memorandum or note thereof in writing. This means that contracts are valid by action of the parties.

Under the Labour Act, a written agreement for employment relationships shorter than 6 months is not required. However, within 2 months of commencing employment, the employer must provide the employee with a written statement of the main terms of the employment contract unless they are employing a casual worker.

The labor law dictates that the standard working time is 8 hours per day or 40 hours per week. However, an organization may prescribe the hours of work differently, subject to the following:

• Where shorter work hours are fixed for particular days, other days may compensate proportionately, but not exceeding 9 hours a day or 40 hours a week.
• Where longer work hours are fixed for particular days, the average number of work hours over 4 weeks must not exceed 8 hours a day or 40 hours per week.
• A seasonal employee may work 10 hours daily, provided that average working hours during the year do not exceed 8.

In Ghana, workers are entitled to paid public holidays. The following holidays are observed:

• New Year's Day - January 1
• Constitution Day - January 7
• Independence Day - March 6
• Good Friday - date subject to change annually
• Easter Monday - date subject to change annually
• May Day (Workers' Day) - May 1
• Eid-Ul-Fitr - date subject to change annually
• Eid-Ul-Adha - date subject to change annually
• Founders' Day - August 4
• Kwame Nkrumah Memorial Day - September 21
• Farmer's Day - first Friday in December
• Christmas Day - December 25
• Boxing Day - December 26

Every employee is entitled to no less than 15 working days' leave with full pay after 12 months of continuous service. Where the work is not regularly maintained throughout the year, the requirement for continuous service is met if the employee has worked for 200 days in a particular year.

Employees can take their annual leave in 2 approximately equal parts. Every employee has the right to enjoy an uninterrupted annual leave. Exception is made in cases of urgent necessity, when employers may require employees to interrupt their leave and return to work. Employers must compensate the employee for any reasonable expense incurred because of the interruption.

Employers must inform their employees at least 30 days before the commencement of leave about its start date. Upon termination of an employment agreement, the employee is entitled to annual leave in proportion to the duration of service in the calendar year (except in the case of termination without notice by the employer). Any agreement to relinquish the right to annual leave or to forgo such leave is null and void.

In Ghana, an employee who has an illness that has been certified by a medical practitioner has the right to a leave of absence. The Labour Act is silent as to whether this leave is with remuneration. The law specifies that sick leave certified by a medical practitioner does not count against an employee's paid annual leave entitlement. Furthermore, if the employee takes certified sick leave starting or during the time annual leave is taken, the sick leave will not be counted as part of the annual leave.

Female employees are entitled to 12 weeks of maternity leave with full pay if they provide a certificate issued by a medical practitioner or midwife, indicating the expected date of delivery. The leave can be extended by 2 additional weeks in case of birth complications or the birth of 2 or more babies.

Under the Labour Act of Ghana, workers on maternity leave are entitled to remuneration of their full wages (paid by the employer) as well as other prearranged benefits, during the 12-week (84-day) period.

There are no provisions on paid or unpaid paternity leave in the Labour Act of Ghana.

Minimum Wage

Effective March 1, 2025, Ghana's national daily minimum wage is GHS 19.97 (Ghanaian cedis), a 10 % increase over the 2024 national daily minimum wage of GHS 18.15.

Monthly minimum wage figures are calculated as daily minimum wage times 27 days. The daily minimum wage is set for all workers (except the Armed Forces, the Prison Service, the Security and Intelligence Agencies, and the Police Service) by the National Tripartite Committee led by the Minister for Employment & Social Welfare. This rate applies to all of Ghana, apart from free trade zones, where employers may freely negotiate and establish employment contracts, including wage levels, that are consistent with ILO conventions.

There are no statutory requirements for payroll frequency in Ghana. It can be determined by the employers and employees in their contracts or through collective agreements. Casual and temporary employees can be paid daily.

Overtime, Holiday & Vacation Pay

The labor law defines overtime as any work time in excess of the regular working hours, averaging at 8 hours per day and 40 hours per week over a reference period of 4 weeks. Overtime work for no additional payment is allowed in certain exceptional circumstances, including severe accidents threatening human lives or the undertaking itself. The law does not fix the rate of overtime remuneration, stipulating that employees may not be required to perform overtime work unless:

• The enterprise has fixed rates of pay for overtime work.
• The undertaking’s very nature requires overtime to be economically viable or is subject to emergencies that require overtime work to avoid a threat to life or property.

All employees are entitled to be paid on public holidays. Temporary and casual employees working on public holidays are entitled to 200% of the regular rate of wages for the hours or days worked.

Employees are also entitled to be paid regular wages during their annual leave. Every employee has the right to enjoy an uninterrupted annual leave. The exception is made in cases of urgent necessity, when employers may require employees to interrupt their leave and return to work. In such a case, employees must be compensated for any reasonable expense incurred because of the interruption.

Notice Period

In Ghana, an employment contract may be terminated for several reasons listed in the Ghanaian Labor Act. The notice length depends on the type of contract:

• In the case of a contract of 3 years or more - 1 month’s notice or 1 month’s pay in lieu of notice
• In the case of a contract of under 3 years - 2 weeks’ notice or 2 weeks’ pay in lieu of notice
• In the case of an agreement from week to week - 7 days’ notice
• At the close of any day without notice, for at-will employment contracts

Notices must be in writing and stipulate the date of issue. In collective agreements with terms more beneficial to the employee, the collective agreement prevails. The length of notice of termination required to be given in the case of a person with a disability must not be shorter than 1 month.

Severance Benefits

An employee has the right to receive severance pay from an employer only when the employer closes down or undergoes a merger and this causes the worker to become unemployed or suffer a diminution in the terms and conditions of employment. The amount of redundancy pay, as well as the terms and conditions of payment, are negotiated between employer and employee or relevant trade union.

In addition to possible redundancy pay, workers are also entitled to the following payments on termination of employment, made within the duration of the notice period, or the next working day in case of no notice:

• Any remuneration earned by the worker before contract termination
• Any deferred payment due to the worker before contract termination
• Any compensation due to the worker with regards to sickness or accident
• Repatriation expenses in the event of contract termination for foreign contracts

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.