What Is The Minimum Wage In Ghana?

If you work for a government agency or a private organization in Ghana, you should be aware of the minimum wage that you are entitled to.

It is your legal entitlement to be compensated, and you are not entitled to anything less than the Ghanaian minimum wage. In truth, the minimum wage is a regulation that is intended to protect Ghanaians who work in both the public and private sectors, according to the government.

What is a Minimum Wage?

Minimum wages have been defined as “the minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period, which cannot be reduced by collective agreement or an individual contract”.

This definition refers to the binding nature of minimum wages, regardless of the method of fixing them. Minimum wages can be set by statute, the decision of a competent authority, a wage board, a wage council, or by industrial or labor courts or tribunals. Minimum wages can also be set by giving the force of law to provisions of collective agreements.

The purpose of minimum wages is to protect workers against unduly low pay. They help ensure a just and equitable share of the fruits of progress to all, and a minimum living wage to all who are employed and in need of such protection. Minimum wages can also be one element of a policy to overcome poverty and reduce inequality, including those between men and women, by promoting the right to equal remuneration for work of equal value.

Minimum wage systems should not be seen or used in isolation but should be designed in a way to supplement and reinforce other social and employment policies. Several types of measures can be used to tackle income and labor market inequality, including pro-employment policies, social transfers, and creating an enabling environment for sustainable enterprises.
The purpose of a minimum wage, which sets a floor, should also be distinguished from collective bargaining, which can be used to set wages above an existing floor.

Minimum Wage In Ghana

The Ghanaian government has established a minimum wage to safeguard employees from extortion and to prevent Ghanaians from being exploited. By law, no employee is required to earn less than the minimum wage that has been established. On the contrary, it is illegal for a company to pay its employees less than the federally mandated minimum wage.

It was decided by the National Tripartite Committee (NTC) following section 113 (1)(a) of the Labour Act, 2023 (Act 651) that the 2021 national daily minimum wage would be raised from GHS11.82 to GHS12.53, representing a 6 percent increase over the previous year’s number of GHS11.82.

In a statement, the Committee said that the daily minimum wage will be hiked to GH13.53 in 2022, representing an 8 percent rise over the previous year’s number of GH12.53.

“The effective date for the implementation of the 2021 national daily minimum wage is June 4, 2021, and the effective date for implementation of the 2022 national daily minimum wage shall be January 1, 2022,” NTC stated in the release.

NTC says the new rate follows the impact of the coronavirus pandemic on the national economy, cost of living, sustainability of business, and desirability of attaining a high level of employment.

As of June 4, 2021, all businesses, institutions, and organizations whose daily minimum salary is less than the national daily minimum wage established by the Commission for the year 2021 shall revise their salaries to reflect this new level of pay.

Any businesses, institutions, or organizations that “flout” the new rate “would be sanctioned in line with the law,” according to a statement from the National Transportation Commission.

There has been an increase in the wages of employees in Ghana after the introduction of the new minimum wage.

It is anticipated that by raising the minimum wage, both the public and private sectors of Ghana’s economy would see an increase in productivity. It also aims to ensure that employees are not paid too little for their efforts. Ghanaian employees may look forward to a fat paycheck at the end of the month as a result of its adoption.