The Minerals and Mining (Local Content and Local Participation) Regulations, 2020 (LI 2431) aims to ensure greater citizen participation in Ghana’s mining value chain.
The justification for the employment of expatriates is the unavailability of the skills they bring on board. And where expatriate staff are engaged on account of the rarity of their skills, steps must be put in place to facilitate the transfer of skills and knowledge to Ghanaians within specific timelines.
What are the aims of the Minerals and Mining (Local Content and Local Participation) Regulations, 2020 (LI 2431)?
The LI 2431 seeks to, primarily, facilitate the development of local capabilities in the mining value chain through education, skills transfer, expertise development, and the transfer of technology and know-how.
Who does the LI 2431 apply to?
The LI 2431 applies to all actors in the mining industry value chain. The mining industry value chain includes the exploration, development, production, refining, smelting, polishing and marketing of minerals.
How is the local content regime expected to work?
A reconnaissance or prospecting licence holder is required to submit a localisation programme for the recruitment and training of its Ghanaian workforce to the Minerals Commission. The details expected in the localisation programme include (a) details of ongoing and planned recruitment and training of Ghanaians to replace expatriates, and (b) the number of expatriates relative to the total number of senior staff to be maintained by the holder of a reconnaissance or prospecting licence. The localisation programme must also be gender inclusive.
Once a localisation plan has been approved, the prospecting or reconnaissance licence holder is required to update the Minerals Commission on an annual basis on the steps taken to implement these steps. Failure to stick to the terms of the localisation plan attracts an administrative penalty in addition to any other sanctions available under the law.
The previous section dealt with reconnaissance and prospecting licence holders. Does it mean that applicants for mineral rights are excluded from the local content law?
No. Applicants for mineral rights, licences to export or deal in minerals, or to provide mine support services are also required to provide particulars of proposals for the recruitment of expatriates and their plans for the employment and training of Ghanaians. Some of the disclosures to be made include the curriculum vitae of the expatriates, the positions to be filled by the expatriates, the conditions of service of the expatriates, the duration of the contract of expatriates, and the plans for training Ghanaians to replace expatriates.
How does the Minerals Commission intend to enforce this?
The Minerals Commission intends to enforce this by working closely with the Ghana Immigration Service. Thus, an immigration quota will be refused if the proposals for the employment and training of Ghanaian workforce are either not met or satisfactory.
It is important to note that these localisations agreements have been elevated to conditions attaching to the mining lease and licences. The LI 2431 makes it clear that the Minerals Commission will not approve of an immigration quota or an application to recruit an expatriate unless the Commission is satisfied that no Ghanaian has the requisite qualification and experience to occupy the position for which the expatriate is to be recruited.
Are there timelines for phasing out or reducing expatriate involvement?
Yes. Timelines have been introduced for the phasing out or reduction of expatriate workers in certain key areas. Different timelines apply to different licence holders.
Reconnaissance or Prospecting licence holder
A reconnaissance or prospecting licence holder may engage expatriates on account of the critical skills that the expatriate worker brings on board. That said, the LI 2431 requires the licence holder to phase out either in parts or whole its expatriate employees over two years (in the case of expatriates filling technical, supervisory and management positions) or after four years (in the case of expatriates holding management positions).
Mining Lease Holders:
In the first three years of its operations, the number of expatriates in senior staff positions must not exceed 10 per cent of the workers in the senior staff bracket. After the third year of operations, the percentage of expatriates working as senior staff must not exceed 5 per cent of the workers in the senior staff bracket. And after the sixth year, the percentage of expatriates in senior staff positions must not exceed 5 per cent but is to be reduced progressively to the point where there can be full Ghanaian participation.
Are the limits imposed on the number of expatriate staff that may be engaged cast in stone?
No. The Minerals Commission may, in exceptional circumstances, permit the engagement of a lot more expatriate workers. These exceptional circumstances may be triggered by the introduction of specialised technology or specialised project for which local expertise is not available.
Can unskilled expatriates be employed?
The LI 2431 specifically kicks against the employment of an expatriate in an unskilled or clerical position.
Are there positions that an expatriate cannot be considered for?
Yes. These positions include general manager roles (after three years of commencement of operations), mine manager roles, all non-technical services and non-engineering roles irrespective of the level or grade, and all roles below the grade of supervisor.