Contract of Employment

All about Contract of Employment in the Workplace, Salaries and Wages and aContract of Employment, Permanent Workers and Temporary Workers and a Contract of Employment and more on AfricaPay Ghana.

A contract of employment means a contract of service whether express or implied, and if express whether oral or in writing. The employment of a worker by an employer for a period of six months or more or for a number of working days equivalent to six months or more within a year shall be secured by a written contract of employment. A contract of employment shall express in clear terms the rights and obligations of the parties.

Types of contract of employment

A contract of employment can be grouped into three main categories depending on the period of payment, such as a monthly contract of employment, a weekly contract of employment and a contract of employment determinable at will. Whereby a worker is entitled to be paid remuneration at a monthly rate, the contract is a contract from month to month. Whereby a worker is entitled to be paid remuneration at a weekly rate, the contract is a contract from week to week. If remuneration is at a rate other than a monthly or weekly rate, the contract is a contract determinable at will.

How long does it take for an employer to give a contract of employment to a newly employed worker?

An employer shall within two months after commencement of the employment furnish the worker with a written statement of the particulars of the main terms of the contract of employment.

Do I, as an employer, need to sign the contract of employment?

Yes. The contract of employment must be signed by the employer.

What are some of the restrictive conditions of employment that the employer should avoid?

An employer shall not in respect of any person seeking employment or of persons already in his or her employment:

  • Require that person to form or join a trade union or to refrain from forming or joining a trade union of his or her choice
  • Require that person to participate or refrain from participating in lawful activities of a trade union
  • Refuse to employ the person because of that person’s membership of a trade union
  • Promise the person any benefit or advantage for not participating in trade union activities
  • Discriminate against the person on the grounds of gender, race, colour, ethnic origin, religion, creed, social or economic status, disability or politics.

On what grounds can a contract of employment be terminated by an employer?

A contract of employment may be terminated by an employer on the following grounds:

  • By mutual agreement between the employer and the worker
  • By the employer on the death of the worker before the expiration of the period of employment
  • By the employer if the worker is found by medical examination to be unfit for employment
  • By the employer because of the inability of the worker to carry out his or her work due to sickness or accident, the incompetence of the worker or proven misconduct of the worker.

What should an employer do if he or she wants to terminate a contract of employment?

A contract of employment may be terminated at any time by an employer by giving to the other party:

  • One month’s notice or one month’s pay in lieu of notice, in case of a contract of three years or more
  • Two weeks’ notice or two weeks’ pay in lieu of notice, in case of a contract of less than three years
  • Seven days’ notice in case of a contract from week to week
  • A contract of employment determinable at will by either party may be terminated at the close of any day without notice.

What form of notice should I give as an employer?

A notice required to be given during termination of contract of employment shall be in writing. The day on which the notice is given shall be included in the period of notice.

Can an employer terminate a contract of employment without notice?

Yes. Either party to a contract of employment may terminate the contract without notice if that party pays the other party a sum equal to the amount of remuneration which would have accrued to the worker during the period of the notice.

What should an employer do if a contract of employment is terminated on fair grounds?

The employer shall pay to the worker:

  • Any remuneration earned by the worker before the termination
  • Any deferred pay due to the worker before the termination
  • Any compensation due to the worker in respect of sickness or accident
  • In the case of a foreign contract, the expenses and necessaries for the journey and repatriation expenses in respect of the worker and accompanying members of his or her family in addition to any or all of the payments. 

When should I, as an employer, make the payment?

The employer shall pay to the worker not later than the date of expiration of the notice all payments due to the worker at the date. Where no notice is required, the payment of all remuneration due shall be made not later than the next working day after the termination.

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