The National Social Security Fund (NSSF) has clarified that the upward review of monthly contributions according to the 2013 Act no 45 is still in effect.
In a statement, NSSF indicated that the Supreme Court had not overturned the Court of Appeal’s orders, which allowed the State to continue implementing the contested Act.
Consequently, the National Social Security Fund reminded Kenyans that employers are still required to remit NSSF contributions in line with the Act.
“The Supreme Court has not lifted the Court of Appeal Orders delivered on 3rd February 2023. Consequently, the National Social Security Fund Act No. 45 of 2013 remains in force.
“We affirm the Notice issued to Employers on 12th January 2024 on remittance of NSSF contributions in line with the National Social Security Fund Act No. 45 of 2013,” the statement read in part.
Supreme court Ruling on NSSF Deductions
The notice issued followed a Wednesday, February 21, ruling by the Supreme Court which indicated that the seven judges led by Chief Justice Martha Koome had reviewed the decision allowing the government to continue implementing the Act despite it being ruled unconstitutional.
Following the Supreme Court ruling, the determination of whether or not the new deductions are unconstitutional will be determined by the Court of Appeal.
Also Read: Supreme Court Rules on Law That Allowed Govt to Hike NSSF Deductions
Employees and employers including members of the Kenya Tea Growers Association and 14 other employer and employee associations, filed five petitions challenging the constitutionality of the Act adding that it would have implications to human rights.
Also, Lawyer John Maina Ndegwa filed a petition before the high court saying that that the contribution rates were unreasonable as Kenyans were already grappling with the high cost of living.
The Labour Court declared the NSSF Act of 2013 unconstitutional, leading to its annulment and preventing the state from proceeding with its implementation.
However, NSSF appealed the ruling and a three-judge bench ruled that the ELRC did not have the jurisdiction to hear a case touching on constitutional validity of the NSSF Act 2013.
Increased Deductions
NSSF announced that the new deductions would take effect at beginning February 2024, increasing contributions to Ksh840 for the lower limit deductions.
Ksh420 of that amount is to be contributed by employees while the other Ksh420 is to be contributed by the employers.
In addition, the lower earnings limit, or the minimum pensionable salary, was raised to Ksh7,000 from the previous Ksh6,000. Consequently, this led to an increase in deductions from Ksh360 to Ksh420, with the employer matching the contributions with Ksh420.
For the upper earnings limit, or the higher pensionable salary, it was raised to Ksh29,000 from the previous Ksh18,000. This resulted in workers being deducted Ksh1,740, up from the previous Ksh1,080. Each contribution was to be matched by the employer.
