Ghana Labor Law Guide for Hiring Employees and Contractors
Ghana is a country in Sub-Saharan Africa with a population of 33 million.
Ghana’s economy showed steady growth in 2023, with a GDP increase of approximately 3.6%, driven by key sectors such as agriculture, manufacturing, and services. The mining sector, particularly gold, along with oil and gas production, plays a significant role in the country’s economy. Agriculture remains a substantial employer, while the services sector has seen growth in telecommunications, finance, and tourism.
Ghana’s currency is the Ghanaian cedi (GHS).
Minimum Wage
GHS 18.15 per day
Overtime Wage
1.5 times regular pay for overtime hours
Meal Breaks
1-hour meal break
Rest Breaks
At least one 30-minute break
Working hours
8 hours/day, 40 hours/week
Salary Payment Cycle
Monthly
Payroll Taxes
Social Security, National Insurance, PAYE
Paid Vacation
15 working days
Overtime Hours
More than 8 hours/day
Night Shift Hours
Additional premium for night work
Holidays
13 public holidays
No Work Days
Saturday and Sunday for most sectors
Businesses hiring in Ghana must register as a legal entity with the Registrar General’s Department. The cost of setting up a business entity varies based on the type of business, with company incorporation taking approximately 1-2 weeks.
Employers are required to sign written contracts with their employees, which must include key clauses such as job description, salary, work hours, and termination conditions.
The labor laws distinguish between employees and contractors, with contractors typically being governed by separate contractual agreements.
Ghana enforces a national minimum wage, which is set at GHS 18.15 per day as of 2024. The minimum wage applies uniformly across sectors, but specific exemptions exist for apprentices and certain categories of workers who may have a different wage structure.
Employers are also required to pay holiday wages for public holidays.
The standard working hours in Morocco are set at 8 hours per day and 44 hours per week. Any work beyond these hours qualifies as overtime and must be compensated at 1.25 times the regular hourly rate. Night shift work, which typically occurs between 9 p.m. and 6 a.m., is compensated at 1.25 times the regular hourly rate.
For night shifts, employees are entitled to a premium, and work at night is regulated under specific safety and labor laws.
The minimum working age is 15, and there are strict laws against child labor.
Employers in Ghana are required to deduct the following from employees’ salaries:
Social Security Contributions: 13.5% of an employee’s salary, of which 5.5% is paid by the employee and 8% by the employer.
PAYE (Pay As You Earn) Tax: Income tax deducted at source based on the employee’s earnings.
Income Tax Rates (2024)
Income Level (GHS) | Tax Rate |
Up to GHS 4,380 | 0% |
GHS 4,381 to GHS 6,204 | 5% |
GHS 6,205 to GHS 12,000 | 10% |
GHS 12,001 to GHS 24,000 | 17.5% |
Above GHS 24,001 | 25% |
Employers in Ghana must provide the following leave entitlements:
Paid Vacation: 15 working days per year.
Maternity Leave: 12 weeks of paid maternity leave, with the option for an additional 2 weeks in case of complications.
Sick Leave: Employees are entitled to paid sick leave based on medical certification.
Public Holidays: 13 mandated public holidays.
Public Holidays (2024)
Holiday | Date |
New Year’s Day | January 1 |
Independence Day | March 6 |
Good Friday | March 29 |
Easter Monday | April 1 |
Workers’ Day | May 1 |
Republic Day | July 1 |
Eid al-Fitr | Varies |
Eid al-Adha | Varies |
Founder’s Day | August 4 |
Christmas Day | December 25 |
Boxing Day | December 26 |
Ghana’s labor laws require employers to provide the following benefits:
Social Security: Contributions towards retirement.
Healthcare: National Health Insurance Scheme (NHIS).
Annual Bonus: Discretionary bonuses depending on the sector.
Gratuity: Paid upon retirement or termination after long service, as per collective agreements.
Ghana does not follow “At Will” employment laws, meaning employers must have just cause for termination. Employers must provide a written notice, usually one month for employees on probation or two months for permanent employees.
Severance pay is provided based on the employee’s length of service, and terminated employees have the right to challenge unfair dismissal through the National Labor Commission or labor unions. Legal grounds for termination include gross misconduct, redundancy, and poor performance.