Ghana Wage Commission Backs Hourly Pay System to Boost Income Fairness

The Ghana Wage Commission has proposed a shift to an hourly pay structure as a strategy to enhance income equity across sectors. The commission argues that the current monthly wage system disproportionately favors salaried employees, leaving many casual and contract workers underpaid for their time and effort. An hourly pay model, they contend, would ensure fairer compensation and align with international labor best practices.

Ghana‘s Fair Wages and Salaries Commission (FWSC) is pushing for a shift to an hourly wage regime, a move officials say could address growing inequities in the labour market and bring greater structure to the country’s expanding informal economy.

The proposal, backed by Acting Chief Executive Officer Dr. George Smith-Graham, comes as policymakers face increasing pressure to modernize Ghana’s wage system and extend protections to vulnerable workers. Speaking during an oversight visit by Parliament‘s Select Committee on Employment, Labour Relations, and Pensions, Dr. Smith-Graham said hourly pay could serve as a tool to improve compensation transparency and reduce income gaps.

“If we begin to look at an hourly wage structure, it will allow casual workers to be better compensated for their time and could help reduce income inequalities in the labour market,” he said.

The proposal marks a notable shift in tone from the FWSC, which has traditionally focused on harmonizing public sector salaries. Smith-Graham argued that a time-based pay model would not only ensure fairer compensation for casual labourers but also provide a pathway to social protection for workers in the informal sector, estimated to account for over 80% of Ghana’s total employment.

The parliamentary committee’s visit included engagements with the National Pensions Regulatory Authority (NPRA) and the Management Development and Productivity Institute (MDPI), amid broader discussions on pension reform and workforce productivity.

At the NPRA, officials briefed lawmakers on provisions that allow individuals aged 50 and above, who are permanently unemployed, to access tier-2 pension funds. The withdrawals are subject to employer verification and Labour Department approval.

NPRA Chief Executive Officer Chris Boadi-Mensah used the occasion to recommend raising Ghana’s official retirement age from 60 to 65, arguing that a longer working life would support the sustainability of the pension system in the face of demographic and fiscal pressures.

The proposals, hourly wages and a later retirement age, signal growing awareness among labour and pension regulators that Ghana’s economic structure may no longer support a one-size-fits-all employment model.

Last Updated on May 19, 2025 by samboad