Engage In Ghana

Table of Contents

About Ghana

Capital City

Accra

Population

As of March 2024, the estimated population of Ghana is 34.1 million.

Currency

The currency in Ghana is the Ghanaian Cedi (GHS). The currency symbol is GH₵‎ .

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Overview

Ghana, located in Western Africa, is a captivating country known for its warm and welcoming people. Bordered by Burkina Faso, Cote d’Ivoire, Togo, and the Gulf of Guinea, this vibrant nation offers a diverse range of experiences for travelers. One of Ghana’s most notable features is the Volta River, which was dammed to create the incredible Lake Volta, the largest artificial lake in the world. Occupying a significant portion of Ghana’s southeastern territory, Lake Volta is a sight to behold. The country’s capital, Accra, attracts visitors with its breezy coastal atmosphere and a charming blend of traditional and modern elements. Ghana’s rich history and culture are evident in its bustling markets, vibrant festivals, and historic landmarks such as Cape Coast Castle and Elmina Castle, which played significant roles in the transatlantic slave trade. With its mix of natural wonders, cultural heritage, and friendly inhabitants, Ghana is a captivating destination that provides a unique and unforgettable experience for every adventurer.

Employment Relationship

Permanent Employment

In Ghana, the Labour Act allows the use of fixed-term contracts for workers engaged in tasks of a permanent nature and does not mandate the use of permanent contracts in these instances. Under the law, temporary workers who are employed by the same employer for a continuous period of more than 6 months are considered as permanent workers if their contract fails to specify employment duration. A permanent contract can be terminated by giving notice to the other party.

Fixed-Term or Specific-Purpose Contracts

There is no documented limit to the maximum duration (including renewals) of fixed-term contracts in the labor law of Ghana. However, it is the employer's responsibility to ensure that the contractor understands the term and that it remains clearly documented in any subsequent extensions or agreements. The Act allows the use of fixed-term contracts for workers engaged in tasks of a permanent nature. Employees whose contracts are renewed successively are considered to be permanent employees.

Temporary Employment Contratcs

The labor law of Ghana makes a distinction between temporary and casual workers. Temporary workers are defined as those who are employed for a continuous period of at least one month and are not permanent workers or those hired for seasonal work. Minimum provisions with respect to wage, hours of work, rest periods, paid public holidays, night work, and sick leave apply to temporary workers. If the temporary employment engagement exceeds six consecutive months, and the employment contract does not specify a duration, the worker is treated as a permanent employee. A contract of employment for a casual worker does not need to be in writing; however, the respective worker is entitled to: Equal pay for work of equal value for each day worked in the organization. Access to necessary medical facilities made available to the workers generally by the employer Be paid for overtime work. Be paid full minimum remuneration for each day on which the employee attends work, whether or not the weather prevents the worker from carrying on regular work and whether it is possible or not to arrange alternative work on such a day.

Probationary Period

In Ghana, the Labour Act does not contain explicit provisions or guidance regarding the maximum duration of probationary periods, but it references a “reasonable” period to be determined in advance. Probationary period and conditions of probation may be provided for in collective agreements. However, when a probationary period is contractually required as a condition for employment, the contract must specify the duration of the probation for the employee. Employees dismissed during their probation are not entitled to any severance or redundancy payment. They can be dismissed without notice. 

Working Hours

The labor law dictates that the standard working time is eight hours per day or 40 hours per week. However, an organization may prescribe the hours of work differently, subject to the following: Where shorter hours of work are fixed for particular days, other days may compensate proportionately, but not exceeding nine hours a day, or a total of 40 hours a week. Where longer hours of work are fixed for particular days, the average number of work hours over a period of four weeks must not exceed eight hours a day or 40 hours per week. A seasonal employee may work for ten hours per day, provided that average working hours during the year do not exceed eight hours a day.

Holidays / PTO

Statutory Holidays

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

Paid Annual Leave

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. 

Sick Leave

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.

Maternity 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 two additional weeks in case of birth complications, or the birth of two 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.

Paternity Leave

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

Termination of Employment

Notice Period

In Ghana, a contract of employment may be terminated for several reasons, which are listed in the Ghanaian Labor Act. The notice length depends on the type of contract: In the case of a contract of three years or more – one month’s notice or one month’s pay in lieu of notice In the case of a contract of under three years – two weeks’ notice or two weeks’ pay in lieu of notice In the case of an agreement from week to week – seven days’ notice At the close of any day without notice, for at-will employment contracts Notices are required to be given in writing and must stipulate the date of issue. In cases of 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 disability must not be shorter than one 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

Social Security

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 Benefit

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 Benefit

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.

Taxation of Compensation and Benefits

Personal Income Tax

Employers are required to compute the income tax on any employment income accrued or derived in Ghana by residents or non-residents. Employers must then remit to the Ghanaian Revenue Authority within the first 15 days of the ensuing month in which the payment was made. At year-end, the employer must reconcile monthly withholdings and in cases of a shortfall, pay the difference on or before January 15. Tax residents are taxed at graduated rates with the highest marginal bracket at 35% for Ghanaian tax residents with annual taxable income exceeding GHS 600,000 (Ghanaian cedis). The tax rate for non-resident individuals is a flat rate of 25%.

Immigration

Types of Visas

Apart from ECOWAS (Economic Community of West African States) nationals and other nations with which the Government of Ghana has specific agreements for gratis visas, all foreign applicants are required to have a visa upon entry into Ghana. The different types of visas offered are: Tourist (visitor) visa Business visa Student visa Employment visa Official visa Diplomatic visa Volunteer visa Press accreditation Transit visa

Work Permit

Foreign nationals wishing to work in Ghana must have a work permit. Applications are submitted via the Ghana Immigration Service.  A work permit issued to foreign nationals must specify the employer, as well as the period for which they may occupy a particular post. The holder may not, without the consent in writing of the authorities, engage in any other form of paid employment or any business or professional occupation in Ghana. A foreign national who has been granted a work permit or immigrant quota cannot start working in Ghana immediately unless they are granted a residence permit by the Director of Immigration to remain and work in the country. Residence permits may be issued for up four years, with an option for a  subsequent extension for another four years.

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