Judicial construction of termination clauses of employment contracts and conditions of service in Ghana: a critique

Abstract

The paper reviewed Supreme Court cases on the construction of termination clauses of employment contracts in Ghana. The review revealed that the principles applied by the Supreme Court to construe termination clauses are principles of contract law developed by the courts over the years. These principles are underpinned by theoretical assumptions that do not distinguish between pure commercial contracts and employment contracts, although the two kinds of contract significantly differ. The result is that workers suffer gross unfairness and job insecurity when courts apply such principles to construe termination clauses. This is so, given that contract- based principles do not recognise and protect workers’ reasonable expectations of fair treatment and job security. The paper contends that unfairness and job insecurity resulting from contract-based principles have wider social ramifications than simply the concern of workers. In the light of sections 62 and 63 of the Labour Act, 2003 (Act 651) of Ghana which protect the right of workers against unfair termination, and in the light of demonstrable inadequacies of the contract-based principles, as espoused in various relevant literature, including judicial opinions, the conclusion of the paper is that it is time courts in Ghana abandoned vocabulary and inapt assumptions of contract law, and to recognise that employment depends on other principles. Based on these other principles, the paper suggests that the reasonable and legitimate expectations of workers should be treated fairly.

Key Words: termination; fairness, job security, contract principles.