Workers are in for tough times after the court of appeal implemented a new law, to raise NSSF contributions ten-fold, from Ksh 200 to Ksh 2,000.
Members will now increase their NSSF contribution to 6% of an employee’s earnings, with the employer (s) expected to follow suit.
Hannah Okwengu, Mohammed Warsame, and John Mativo, the appeal court Justices behind this directive ruled that the National Social Security Fund, (NSSF) 2013 act which sought to increase the monthly contribution was legal.
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This law was set in stone after the court of appeal argued that the labour courts had no mandate to challenge the new contribution rates since the case was not within employer-employer jurisdiction.
“We find that the Employment and Labor Relations Court (ELRC) made a mistake in declaring the Act unconstitutional when it had no jurisdiction to question the validity of the law as that was a preserve of the High Court,” said the judges
The three justices said that they approved this law as per the 2013 act and it was subjected to public participation by the 2010 constitution.
The move to increase the NSSF contributions is a fulfilment of President William Ruto’s intention to increase employees’ monthly contributions in what he says will play a part in bettering people’s lives come retirement.
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“Majority of people on the roll of NSSF are paying Ksh 200, it is ridiculous. We just got a ruling from the court a week ago that it is wrong for us to increase it from Ksh200, I don’t know what we are doing. Do we live in the same country?” said President Ruto.
This law’s implementation comes barely months after the labour court judges Nduma Nderi, Hellen Wasilwa, and Monica Mbaru declared the act unconstitutional in September 2022.
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This was after the Kenya Tea Growers Association led the front to challenge the law. The three labour court judges refuted the law, terming it unconstitutional because it was not taken through the due process of public participation as required.
According to NSSF, the country’s current dependency ratio is too high, and higher savings will help give better retirement packages to people.
