Navigating the complex labour laws governing employment practices is essential when running Ghana payroll. However, building an in-house compliance team may not be the most efficient way to manage your remote team’s payroll in Ghana.

Regardless of size, global companies need help to secure in-country expertise for localised payroll service. This is where a partner like Workforce Africa provides significant value in supporting global firms to maintain compliance when handling payroll in Ghana, addressing every intricate detail, including;

• Salary computation requirements, taxation legislation specifics (social security, employee income tax, corporate tax, VAT and other employee deductions.
• Benefits administration, and more (health insurance, pension, paid leaves, holiday compensation.

Workforce Africa simplifies hiring and payroll compliance for offshore talent management in Ghana. No need for a subsidiary or entity setup. From contracts and onboarding to taxes, payroll, and admin tasks, partnering with us – a payroll firm in Ghana will help you focus on growth for greater levels of success.

Employment Contract Termination

In accordance with the laws of Ghana, the length of termination notice is typically determined by the terms outlined in the contractual agreement between the employee and their current employer. In most cases, this notice period can range from two weeks to one month. Alternatively, employers may provide one month’s salary in lieu of notice, especially if the employment contract specifies this option.

Conversely, an employee may terminate their contract by resigning in writing, which must be acknowledged by the employer. It is essential to follow the proper procedures for terminating an employment contract to avoid any potential legal disputes or penalties.

Ghana Country Overview

The Republic of Ghana lies in West Africa. It is predominantly an English-speaking country. Two critical cities in Ghana are Accra, the capital and the economic hub, and Kumasi. These urban centres act as transit points to ecotourism destinations and beach resorts. With a population exceeding 34.4 million people, Ghana boasts a significant demographic presence.

In recent years, key industries experiencing growth include gold, cocoa beans, and timber. Ghana boasts a market-based, diversified economy comprising mining, lumbering, light manufacturing, aluminum smelting, food processing, cement, and services. Considerations such as the low labour cost and abundant natural resources make Ghana attractive for businesses seeking expansion opportunities.

Although Ghana possesses a highly skilled workforce, hiring and establishing a team can be time-consuming and challenging. However, partnering with an Employer of Record (EOR) or Professional Employer Organisation (PEO) in Ghana facilitates swift market entry. It manages all legal complexities associated with operations in the country.

Payroll Processing in Ghana

Local labour laws in Ghana govern payroll processing, with each employee’s salary potentially calculated differently. Due to compliance concerns, processing payroll at scale can become complex, cumbersome, and risky. Here are the phases of payroll processes global businesses should understand-:

Pre-payroll Phase

Your organisation’s unique approach to payroll compliance shapes its policies and processes, including payroll preparation. Global firms must prioritise essential business elements in the pre-payroll phase, such as accurate business profile documentation and tailored work location policies, which is crucial. Customise leave and work policies to align with local standards in Ghana to ensure compliance and transparency while collaborating closely with compliance teams or partners to help adhere to statutory requirements throughout the payroll management process for your remote team.

In this phase also, standardising compensation packages to conform with local payment norms, such as payment cycles, which enhance compliance and meet employee expectations, is necessary.

Payroll Calculation Phase

Streamlining input collection and validation processes ensures accurate wage calculations in this phase of payroll processing. This phase involves the actual calculation of wages, with a primary focus on this task. Utilising software automation and digital document submission tools makes payroll calculations efficient and reduces the risk of human error in this process.

Post-payroll Phase

The post-payroll phase in Ghana refers to the period after payroll processing, where employers review and settle any outstanding issues related to employee compensation, benefits, and taxes. This phase typically includes: salary payment, compliance reporting, benefit administration, audit and reconciliation.

The post-payroll phase is crucial in Ghana as it ensures that employers comply with regulatory requirements, maintain a good employer-employee relationship, and reduce the risk of penalties or fines associated with non-compliance.

Payroll Components in Ghana

Here are some aspects comprehensively needed to navigate Ghana’s payroll compliance:

• Salary/Wages
• Overtime benefits
• Social security contribution
• Paid leaves
• Paid holidays
• Payroll taxes
• Other laws

Navigating Ghana Payroll Compliance

• Annual Leave: Workers are entitled to at least 15 working days of fully paid annual leave after completing a full employment year.
• Sick Leave: Ghana’s Labour Act does not provide explicit guidelines for paid sick leave. However, it does clarify that sick leave certified by a medical practitioner is separate from annual leave entitlements. In practice, sick leave and its payment are often outlined in employment contracts or collective agreements. For job-related illnesses, the Workmen’s Compensation Law guarantees full wage payment, medical treatment, and appropriate compensation.
• Maternity Leave: According to the law, Maternity leave is at least 12 weeks paid period of absence; it can be extended by an additional 2 weeks in the case of birth complications. Paternity leave is optional.
• Other Leave: In Ghana, employees may be granted compassionate/ special leaves on some family events. Such leave shall be paid within the limits and deadlines specified. Public holidays are not fixed days and they can be changed according to the government decision.
• Paid Public Holidays: In Ghana, the paid holidays are as follows:
  • New Year’s Day: January 1
  • Constitution Day: January 7
  • Independence Day: March 6
  • Good Friday: Date Varies
  • Easter Monday: Date Varies
  • May Day (Workers’ Day): May 1
  • Eid al-Fitr: Date Varies
  • Africa Unity Day: May 25
  • Eid al-Adha: Date Varies
  • Republic Day: July 1
  • Founders’ Day: August 4
  • Kwame Nkrumah Memorial Day: September 21
  • Farmers’ Day: December 6
  • Christmas Day: December 25
  • Boxing Day: December 26

Payroll Outsourcing in Ghana

Payroll in Ghana also encompasses termination and severance law. There is no mandatory severance pay for individual dismissals that are not related to economic reasons. Severance pay is typically calculated based on the length of service and the employee’s daily wage.

Collaborate with an Africa employer of record and payroll solutions provider such as Workforce Africa to strategically outsource your payroll operations while ensuring compliance with local labour regulations. Additionally, leverage our flexible service offerings to expand your international teams as needed.