The Good, The Bad & The Ugly of New NSSF Rates. Kenyan Employees React

By Jane Gakaria,

Kenyan employers and employees are really feeling the crunch with the newly increased NSSF contributions. The implementation of the Act starting from June 1, 2014 would see employees monthly salaries deductions rise from sh. 200 to sh. 600 for the lowest earner and sh. 320 to sh. 1080 for the higher cadre.

Employers too aren’t having it easy and through their union, the Federation of Kenya Employers, have threatened to stop deduction of the increased NSSF Contributions unless companies are allowed to run their own schemes.

On that note I decided to get several employees opinions on the raised contributions and how they would impact them.

Lucy Ouko* a Sales Consultant says, “This is an extra burden since I pay for all my bills, that is, transport, rent, food etc by myself. This will now force me to use part of my savings to fill in the extra gap created. So for now it won’t really be a major impact since I do have savings to fall back on but once they increase them to that 6 percent I’m not too sure what’s going to happen.

Emily Wanja*, Administrator at a local SME,” I think it’s great that they have increased the rates. After all it is my money and the new rates will mean that I will get more when I retire. Think about it this way, I pay 1 thousand my boss pays another 1 thousand, which comes to two thousand and 24 thousand in a year. That’s a lot and I’m not too sure why it took them so long to raise them. So,no I’m not bothered by the rates as I still can meet all my needs and living standards.

Lucas Mueni*, HR Officer with a Recruitment Firm. “I’d say the idea behind it is great but the timing is rather poor considering that so many other costs have risen. For now, it’s a small pinch on my pocket but then again a pinch is still a pinch. Since this is the first year I don’t see me being affected in a major way but when it gets to that 6 percent, am not to sure how I’ll be surviving.

Jane Cheptoo*, Receptionist at a Hotel. “As for me I feel completely indifferent. I’m a new employee who just got hired this month so my June salary will be my first one ever, hence I’ll feel no pain. Maybe if I were older and had previous jobs then I’d see the difference or maybe the next time they do decide to raise the rates then I’ll have something to say.

If you’re an employee or employer, let’s keep the discussion going and let us know what your opinion is on the matter.

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