11. Labor Policies and Practices
Ghana has a large pool of unskilled labor. English is widely spoken, especially in urban areas. However, according to the United Nations, nationwide illiteracy remains high at 33 percent. Labor regulations and policies are generally favorable to business. Although labor-management relationships are generally positive, occasional labor disagreements stem from wage policies in Ghana’s inflationary environment. Many employers find it advantageous to maintain open lines of communication on wage calculations and incentive packages. A revised Labor Act of 2003 (Act 651) unified and modified the old labor laws to bring them into conformity with the core principles of the International Labor Convention, to which Ghana is a signatory.
Under the Labor Act, the Chief Labor Officer both registers trade unions and approves applications by unions for a collective bargaining certificate. A collective bargaining certificate entitles the union to negotiate on behalf of a class of workers. The Labor Act also created a National Labor Commission to resolve labor and industrial disputes, and a National Tripartite Committee to set the national daily minimum wage and provide policy guidance on employment and labor market issues. The National Tripartite Committee includes representatives from government, employers’ organizations, and organized labor. The Labor Act sets the maximum hours of work at eight hours per day or 40 hours per week, but makes provision for overtime and rest periods. Some categories of workers, including trades workers and domestic workers, are excluded from the eight hours per day or 40 hours per week maximum.
The Labor Act prohibits the “unfair termination” of workers for specific reasons outlined in the law, including participation in union activities; pregnancy; or based on a protected class, such as gender, race, color, ethnicity, origin, religion, creed, social, political or economic status, or disability. The Labor Act also provides procedures companies are required to follow when laying off staff, including under certain situations providing severance pay, known locally as “redundancy pay.” Disputes over redundancy pay can be referred to the National Labor Commission. The Act’s provisions regarding fair and unfair termination of employment do not apply to some classes of contract, probationary, and casual workers.
There is no legal requirement for labor participation in management. However, many businesses utilize joint consultative committees in which management and employees meet to discuss issues affecting business productivity and labor issues.
There are no statutory requirements for profit sharing, but fringe benefits in the form of year-end bonuses and retirement benefits are generally included in collective bargaining agreements. Child labor remains a problem. Child labor is particularly severe in agriculture, including in cocoa and fishing. In general, worker protection provisions in the Labor Act, including health and safety provisions, are weakly enforced. Post recommends consulting a local attorney for detailed advice regarding labor issues. The U.S. Embassy in Accra maintains a list of local attorneys, which is available through the U.S. Foreign Commercial Service ( ) or U.S. Citizen Services (https://gh.usembassy.gov/u-s-citizen-services/attorneys/).