You are here: HomeNews2018 08 09Article 675542

Business News of Thursday, 9 August 2018


BoG, 5 collapsed banks breached labour law – Labour expert

A labour analyst Ben Arthur says the Bank of Ghana and the five collapsed banks may have breached the country’s labour law.

According to him, section 65 of the Labour Act requires employers contemplating on merger or amalgamation that could result in job losses to write to inform the chief labour officer, three clear months, for him to conduct an assessment before such action is carried out.

However, Mr. Arthur believes that section of the law was overlooked by the central bank and the five collapsed banks –Unibank, Sovereign, Construction, Royal and Beige banks.

BoG establishes Consolidated Bank for 5 distressed banks
“Let me use this opportunity to tell the Bank of Ghana and the managers of this various banks that there is one law in Ghana that it seems to be that they haven’t complied with; that is Labour Act 2003, Act 651 section 65,” he said on TV3’s News360 Wednesday.

His comment comes on the back of the 60-day probation notice given to the staff of the five banks who are now workers of the newly established Consolidated Bank Ghana Limited that took over the assets and liabilities of the five banks in August 1, 2018.

Staff of 5 collapsed banks given 60 days to prove themselves to keep their job
Mr. Arthur explained the rationale behind that section of the law is to protect the employment rights of workers as recognized by the 1992 constitution.

“When you employ anybody in Ghana, you haven’t done that individual a favour. For the protection of the rights of that individual, we [the law] say report,” to the chief labour officer to do an assessment to determine layoffs and opportunities available for them.

He observed that some employers sometimes resolve to fold up after they have made their profit.

“One key thing to do is not just to layoff, you look for alternative employment, you cannot also claim that their skills have become obsolete so you are laying them off. You will look for alternative employment because as an employer, you are obliged to train and retrain them”, he stated.

The analyst said there are a lot of things that must be considered before an amalgamation of companies, indicating that where there is going to be termination, “if they [employees] have a union, the union must represent them and negotiate their severance or redundancy fee”.

Meanwhile, he said job losses arising out of amalgamation come in two ways or different definitions which could be a responsibility or benefit based on rank

“It can be a job loss of a kind, it can be a reduction in status, in function or seniority,” he explained, adding ‘if we have three MD’s or we have three entities coming together, there can no longer be three managers, there can only be one”, he explained