The Complete Guide to Employer of Record Services in Ghana

Ghana’s rapidly growing economy and skilled workforce make it an attractive destination for businesses looking to hire talent and expand operations. However, navigating Ghana’s labor laws, payroll systems, and compliance requirements can be complex, particularly for foreign companies.

Cadana’s Employer of Record (EOR) solution simplifies the hiring process in Ghana, ensuring businesses remain compliant while streamlining payroll, tax administration, and employee benefits.

What is an Employer of Record (EOR)?

An Employer of Record (EOR) is a third-party provider that legally employs workers on behalf of businesses, handling all HR-related functions, including:

Hiring employees and managing employment contracts.
Processing payroll and tax compliance (SSNIT & PAYE).
Administering statutory and supplemental benefits.
Ensuring compliance with Ghanaian labor laws.

With Cadana’s EOR solution, businesses can hire in Ghana efficiently, without the need to set up a legal entity.

The Risks of Employee Misclassification in Ghana

Misclassifying workers as independent contractors instead of employees can expose businesses to legal and financial risks, including:

Legal Penalties: Ghana’s labor authorities impose strict fines for worker misclassification.
Tax Liabilities: Companies may be required to retroactively pay taxes and social security contributions.
Employee Lawsuits: Workers may claim unpaid statutory benefits, severance pay, or wrongful termination.
Reputational Damage: Non-compliance can damage a company’s credibility and ability to do business in Ghana.

Cadana ensures proper worker classification, helping businesses hire in Ghana without legal or financial risks.

Benefits of Using an Employer of Record in Ghana

Cadana’s EOR services provide businesses with a seamless solution for hiring in Ghana, offering benefits such as:

Compliance with Ghanaian Labor Laws: Ensure all employment contracts, payroll processes, and benefits meet legal requirements.
Faster Hiring Process: Hire employees in Ghana quickly, without the hassle of entity registration.
Cost-Effective Expansion: Reduce operational costs by outsourcing HR, payroll, and compliance functions.
Streamlined Payroll & Tax Administration: Cadana handles salary processing, statutory deductions, and tax remittances.
Enhanced Employee Experience: Ensure timely payments and statutory benefits, boosting employee satisfaction and retention.

Overview of Hiring in Ghana

Employment Laws

Ghana’s labor market is regulated by the Labour Act, 2003 (Act 651), which establishes:

Written employment contracts for all full-time employees.
Minimum wage and salary payment regulations.
Mandatory employer contributions to the Social Security and National Insurance Trust (SSNIT).
Employee rights to benefits such as paid leave, severance pay, and social security contributions.

Onboarding Process

When hiring in Ghana, businesses must:

Draft a legally compliant employment contract specifying job responsibilities, salary, benefits, and leave entitlements.
Register employees with the Social Security and National Insurance Trust (SSNIT).
Ensure compliance with the Pay-As-You-Earn (PAYE) tax system.

Cadana simplifies onboarding, ensuring compliance while enabling smooth hiring in Ghana.

Payroll Management and Tax Compliance in Ghana

Payroll Frequency

Employees in Ghana are typically paid monthly, with payroll taxes and statutory contributions deducted at the source.

Income Tax (Pay-As-You-Earn – PAYE)

As of January 1, 2024, Ghana uses a progressive tax system for employee salaries:

First GHS 5,880 – 0%
Next GHS 1,320 – 5%
Next GHS 1,560 – 10%
Next GHS 38,000 – 17.5%
Next GHS 192,000 – 25%
Next GHS 366,240 – 30%
Above GHS 600,000 – 35%[1][2][5].

Employers must deduct PAYE from employee salaries and remit it to the Ghana Revenue Authority (GRA) monthly.

Employer Contributions

Employers in Ghana are required to make the following statutory contributions:

Social Security and National Insurance Trust (SSNIT): Employers contribute 13% of the employee’s gross salary; employees contribute 5.5%, deducted from their salary.
National Health Insurance Levy (NHIL): Employers contribute towards Ghana’s National Health Insurance Scheme (NHIS), ensuring employees have access to medical care.
Workmen’s Compensation Insurance: Employers must provide compensation coverage for workplace injuries or occupational diseases.

Cadana ensures compliance with Ghana’s payroll and tax laws, handling all deductions and timely remittances.

Overview of Employment Contracts in Ghana

Employment contracts in Ghana must outline:

Job Description & Responsibilities.
Salary, Bonuses & Allowances.
Working Hours & Leave Entitlements.
Termination & Notice Periods.
Dispute Resolution Mechanisms.

Types of Employment Contracts

Fixed-Term Contracts: For project-based or temporary work.
Indefinite-Term Contracts: For long-term employment with no predetermined end date.

Probation Periods

Typically up to 6 months, after which employees transition to permanent roles. During probation, termination may require one month’s notice.

Cadana ensures all employment contracts comply with Ghana’s labor laws, reducing legal risks for businesses.

How an EOR in Ghana Ensures Compliance with Employment Law

Ghana’s labor laws regulate:

Working Hours: 40 hours per week, Monday to Friday.
Overtime Pay: Required for work exceeding contractual hours.
Termination Process: Employees must receive notice and severance pay, depending on their length of service.

Cadana’s EOR solution ensures businesses hire in Ghana while remaining fully compliant with labor laws and avoiding penalties.

Employee Benefits and Compensation in Ghana

Statutory Benefits

Annual Leave: A minimum of 15 days per year after 12 months of service.
Maternity Leave: 12 weeks of paid leave for female employees.
Sick Leave: Employees are entitled to paid sick leave based on medical certification.

Supplemental Benefits

To attract top talent, many employers offer:

Private health insurance.
Performance bonuses.
Transportation allowances.

Cadana administers employee benefits, ensuring compliance with statutory and supplemental requirements.

How an EOR Can Improve Employee Experience

By partnering with Cadana, businesses can provide:

Timely and accurate payroll processing.
Access to statutory and supplemental benefits.
Efficient HR and compliance support.

A great employee experience enhances productivity, helping businesses hire and retain top talent in Ghana.

Get Started with an EOR in Ghana

Expanding into Ghana is easier with Cadana’s EOR solution. We help businesses:

Hire employees in Ghana efficiently.
Manage payroll and tax compliance.
Ensure full compliance with Ghanaian labor laws.

Implementing EOR Solutions: A Practical Guide for Hiring in Ghana

Assess Hiring Needs: Define the roles and skill sets required.
Partner with Cadana: Our EOR solution streamlines hiring in Ghana.
Onboard Employees Quickly: We handle contracts, tax registration, and benefits.
Monitor HR & Compliance: Ensure compliance while focusing on business growth.

Why Choose Cadana for Hiring in Ghana?

Ghana’s labor market presents significant growth potential, but navigating employment regulations can be complex. Cadana simplifies the hiring process, handling compliance, payroll, and HR functions so businesses can focus on success.

By using Cadana’s Employer of Record services, companies can hire in Ghana with confidence, ensuring full compliance while minimizing administrative burdens.

Ready to hire in Ghana? Connect with Cadana today and start building your workforce with ease!