Study reveals lapses in non-wage benefits

A study on the impact of workers’ unions on non-wage benefits, in the Ghanaian labour market, has revealed that many Ghanaian workers, especially in the industrial and agriculture sectors do not enjoy non-wage benefits.

Workers in the services sector were found to be the highest beneficiaries of non-wage benefits due to the high compliance by service sector employers in the payment of non-wage benefits such as paid holidays, sick leave and maternity leave.

The report on the study, titled, “An empirical assessment of the union facilitation effect in the Ghanaian labour market,” said the informal sector experienced the lowest compliance of non-wage benefit labour regulations.

Conducted by Dr. Nkechi S. Owoo and Monica P. Lambon-Quayefio, both lecturers and Samuel Manu, a research assistant, all of the Economics Department of the University of Ghana, the report attributed the situation to the level of performance and involvement of workers unions in facilitating the provision of the benefits by employers.

By law, as enshrined in the Labour Act (Act 651), all workers are entitled to paid holidays (Article 20), sick leave (Article 24) and maternity leave for female workers (Article 57).

The report indicated that although workers may be eligible for various forms of non-wage benefits and entitlements- both statutory and non-statutory- they may fail to take advantage of these if they were unaware of their existence, or did not have strong unions to demand those benefits.

It attributed the high compliance rate in the formal sector, particularly the services sector, to the high presence and facilitation of worker unions and high awareness of workers about their rights to working conditions.

Sections of the formal sector where compliance has been low have poor performing unions, while the workers are largely unaware of their rights, the report noted.

With regard to the informal sector, it indicated that the high rate of non-compliance in offering non-wage benefits was due to poor presence of worker unions.

It, therefore, recommended the increased unionisation of workers in the informal sector which holds about 80 per cent of Ghanaian workers.

“The study makes the argument for greater union efforts in facilitating access to these benefits.

“Sectors with low compliance such as the agricultural and manufacturing sectors are likely to benefit from the dissemination of union publications, training sessions, among others, to increase worker knowledge and awareness of benefits,” the report said.

It said, “Access to these benefits are likely to increase the quality of work for such workers, an important objective of the National Employment Policy (2015) of Ghana, and may also ensure continuity in the labour market as women may find it easier to overcome noted incompatibilities in domestic and labour market responsibilities.”

According to the report, the study examined the evidence for union facilitation effects among workers in Ghana, using data from the 2012/13 Ghana Living Standards Survey (GLSS).

“This study examines the determinants of nonwage benefit entitlements in the Ghanaian labour market, with particular interest on the effect of union presence on greater coverage of certain legally-mandated benefits among workers,” it added.

By Edmund Mingle


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