Employment Laws and Policies in Kenya

Employment Contracts in Kenya

Employment law in Kenya is primarily governed by the Employment Act, 2007 (as amended) and Labour Relations Act, 2007.

Contract Requirements

Employment contracts must be in written form for all employees.

Contracts must be provided within 2 months of employment start and include:

• Full names and addresses of employer and employee
• Job title and description of duties
• Place of work (workplace address or if remote/mobile)
• Start date of employment
• Expected duration (if fixed-term contract)
• Notice periods for termination
• Remuneration (salary/wage) and payment frequency
• Working hours and days
• Leave entitlement (annual leave, sick leave)
• Any other terms and conditions

Language:

• Contracts typically in English (official business language)
• Can include Swahili translation if needed

Delivery:

• Copy provided to employee
• Employer retains copy

Types of Contracts

1. Contract for an Indefinite Period (Permanent Contract)

• Standard, open-ended employment relationship
• No predetermined end date
• Full statutory protections and benefits
• Most common contract type in Kenya

2. Contract for a Fixed Period (Fixed-Term Contract)

• Defined end date or completion of specific task/project
• Must be genuinely justified (project-based work, seasonal work, temporary replacement, specific assignment)
• Maximum duration: No statutory limit, but:
  • If renewed or extended beyond 2 years cumulative, employee gains rights equivalent to permanent employee (including unfair dismissal protection)
  • Courts scrutinize repeated renewals to prevent abuse
• At expiry: Employment ends (no statutory severance unless contract provides)

3. Contract for a Specific Task

• For completion of specific piece of work or task
• Ends upon completion
• Common in construction, consulting, project-based work

4. Casual Employment

• Day-to-day employment for short periods
• Maximum 24 working hours per month with same employer
• If exceeds 24 hours/month for 3+ consecutive months → deemed to be employed on permanent basis
• Limited benefits (pro-rata pay, but often excluded from full statutory benefits in practice)

5. Part-Time Employment

• Less than standard full-time hours
• Pro-rata entitlements
• Same protections as full-time employees (proportional)

6. Domestic Worker Employment

• Specific provisions under Employment Act
• Must have written contract
• Minimum wage, leave, accommodation provisions

Probation Period

• Maximum duration: 6 months (can be shorter, never longer by statute)
• Must be clearly stated in written employment contract
• Can be extended once by mutual agreement for additional maximum 6 months (total max: 12 months)
• During probation:
  • Full salary and benefits apply (NSSF, NHIF, PAYE, etc.)
  • Notice period: 7 days (either party, or as specified in contract if longer)
  • Employer can terminate more easily (unsuitability for role), but should still follow fair procedures
• After probation:
  • Automatic transition to permanent employment
  • Full notice periods and unfair dismissal protections apply

Note: Probation cannot be used repeatedly to evade permanent employment obligations.

An EOR ensures all employment contracts comply with Kenya Employment Act 2007 and mandatory provisions.

---

Working Hours in Kenya

Working time in Kenya is regulated by the Employment Act, 2007.

Standard Working Hours

Statutory maximum:

• 52 hours per week (standard maximum, can work up to this with overtime)
• Standard work week: Typically 45 hours (9 hours/day × 5 days, or 8 hours/day × 5.5 days)
• Some sectors: 40 hours/week common in professional services, IT, finance

Common practice:

• Monday-Friday work week (5 days) with half-day Saturday (some sectors), or
• Monday-Friday only (professional sectors, IT, BPO)
• 8:00 AM – 5:00 PM typical office hours (with 1-hour lunch break)
• Saturday-Sunday: Weekend (days off) in most sectors

Reduced hours:

• No specific statutory reduced hours for categories (unlike some countries), but employers may provide reduced schedules for specific roles or arrangements

Rest Periods and Breaks

Daily rest:

• Minimum 12 consecutive hours rest between end of work and start of next shift

Weekly rest:

• Minimum 24 consecutive hours per week (typically Sunday, or as agreed)
• Cannot work more than 6 consecutive days without rest day

Meal/rest breaks:

• After 5 hours continuous work, employee entitled to at least 1-hour break for meals
• Can be reduced to 30 minutes by mutual agreement (but 1 hour standard)
• Unpaid break (not counted as working time)

Overtime (Overtime Work)

Overtime = hours beyond standard work week (typically >45 hours/week).

Overtime compensation:

• 1.5× normal hourly rate for overtime hours

Calculation:

• Hourly rate = Monthly salary ÷ (52 hours/week × 52 weeks/year ÷ 12 months) = Monthly salary ÷ 225.33 hours
• Or as specified in contract

Limits:

• No strict statutory maximum overtime hours, but must be reasonable
• Employee consent generally required (cannot force excessive overtime without agreement)

Rest day/public holiday work:

• 2× normal rate for work on rest day or public holiday
• OR compensatory day off + normal pay (by agreement)

Note: Many employment contracts (especially managerial/professional) specify “all-inclusive” salary covering reasonable overtime (no additional overtime pay). This must be clearly stated in contract.

Night Work

Night time: No specific statutory definition of night work in Kenya (unlike some countries with night shift premiums).

Practice:

• Employers may provide shift allowances for night work
• BPO sector: Common to have night shifts (serving international markets), often with shift allowances

Public Holiday Work

If required to work on public holiday:

• 2× normal rate for hours worked
• OR compensatory day off + normal pay

Flexible Work Arrangements

Kenya increasingly supports:

• Remote work (accelerated post-COVID, especially IT, BPO, professional services)
• Hybrid models (office + remote)
• Flexible hours (flextime within business needs)
• Part-time arrangements

Remote work considerations:

• Clear policies on equipment, expenses, working hours
• Data security (especially BPO handling client data – PCI-DSS, GDPR compliance for EU clients)

---

Employee Leave in Kenya

Kenyan Employment Act provides statutory leave entitlements.

Annual Leave (Paid Vacation)

Statutory minimum:

• 21 days per year (working days, not including public holidays or rest days)
• After every 12 months continuous service

Accrual:

• Accrues after completing 12 months service (first year)
• Once entitled, accrues monthly (pro-rata)

Scheduling:

• Employer and employee agree on timing
• Employer should schedule to ensure employee takes leave within reasonable period
• Can be taken in installments (by agreement), but at least 2 consecutive weeks once per year

Carry-over:

• Unused leave can be carried forward (by agreement)
• Should be taken within reasonable period (typically within following year)

Cash payment:

• Cannot be paid in lieu during employment (must take leave)
• Exception: Upon termination, all accrued unused leave paid out

Payment during leave:

• Paid at normal wage/salary rate

Many employers offer more generous leave:

• 22-28 days common in professional sectors, IT, BPO, multinationals

Public Holidays

Kenya observes approximately 13 public holidays annually:

Fixed national holidays:

• New Year’s Day (1 January)
• Good Friday (variable – March/April)
• Easter Monday (variable – March/April)
• Labour Day (1 May)
• Madaraka Day (1 June – self-governance commemoration)
• Mashujaa Day (20 October – Heroes Day, formerly Kenyatta Day)
• Jamhuri Day (12 December – Independence Day, Republic Day)
• Christmas Day (25 December)
• Boxing Day (26 December)

Islamic holidays (variable dates, lunar calendar):

• Eid al-Fitr (end of Ramadan) – 1 day
• Eid al-Adha (Feast of Sacrifice) – 1 day

Hindu holiday:

• Diwali (variable date) – 1 day (typically observed)

Note: If public holiday falls on Sunday, following Monday is typically observed as holiday.

Entitlements:

• Public holidays are paid days off (in addition to annual leave)
• If required to work on public holiday: 2× rate or compensatory day off

Sick Leave

Statutory sick leave:

Entitlement:

• 7 days on full pay
• 7 days on half pay
• After 2 months continuous service
• Per 12-month period (annual entitlement)

Additional sick leave:

• After 14 days: Employer not obligated to pay, but cannot dismiss employee for legitimate illness for reasonable period (typically courts consider up to 4-6 months cumulative sick leave reasonable, depending on circumstances)

Medical certificates:

• Required if sick leave exceeds 3 consecutive days
• From registered medical practitioner
• Employee must submit within reasonable time

Employer obligations:

• Pay sick leave as per statutory minimums
• Cannot dismiss employee for legitimate illness (within reasonable period)
• After prolonged illness, employer may terminate for incapacity (with medical evidence, fair procedures)

Maternity Leave

Statutory maternity leave:

Duration:

• 3 months (90 days) total maternity leave
• Can commence any time from 4 weeks before expected delivery date (mother’s choice)
• Typically taken: Some weeks before birth + remaining after birth

Eligibility:

• All female employees entitled after 12 months continuous service

Maternity pay:

• Full pay (100% salary) for entire 3 months
• Paid by employer (not social security/state)

If less than 12 months service:

• Entitled to 3 months maternity leave (unpaid)
• Job protection still applies

Job protection:

• Employer cannot dismiss pregnant employee or mother on maternity leave (except company closure or serious misconduct)
• Position must be held open
• Right to return to same or suitable alternative position

Nursing breaks:

• After return from maternity leave:
  • Mother entitled to nursing breaks during working hours (typically 1 hour/day or as agreed)
  • Duration: Until child is reasonable age (typically 1 year, practice varies)
  • Paid time

Additional protections:

• Cannot require pregnant woman to work in conditions harmful to health
• Cannot dismiss pregnant employee (except for gross misconduct or company closure)

Paternity Leave

Statutory paternity leave:

• 2 weeks paid paternity leave
• Introduced in 2022 (recent addition)
• Must be taken within 2 weeks of birth
• Full pay (100% salary)
• Paid by employer

Parental Leave

No specific statutory parental leave beyond maternity/paternity.

Unpaid leave:

• Employee can request unpaid leave for childcare/family reasons by agreement with employer

Compassionate/Bereavement Leave

No specific statutory bereavement leave.

Common practice:

• 3-7 days paid leave for death of immediate family member (spouse, child, parent, sibling)
• Varies by employer policy
• Often requires proof (death certificate, funeral notice)

Other Leave

Study leave:

• No statutory study leave
• Some employers provide paid or unpaid study leave for exams, courses (by policy)

Unpaid leave:

• By mutual agreement for personal reasons

Pilgrimage leave (Hajj):

• Not statutory
• Some employers provide unpaid leave for religious pilgrimage (by request)

Jury duty/Civic duty:

• Employees summoned for jury service or other civic duties entitled to time off
• Employer not required to pay (but some do by policy)

---

Employee Benefits in Kenya

Mandatory Statutory Benefits

1. National Social Security Fund (NSSF) Contributions

NSSF is Kenya’s pension/retirement savings scheme (recently reformed with new higher contribution rates).

NSSF Contribution Rates (New NSSF Act 2013, fully implemented 2023):

Two-tier system:

Tier I (Lower Earnings Limit to Tier I Limit):

• Lower Earnings Limit: KES 6,000/month
• Tier I Limit: KES 7,000/month
• Contribution on Tier I (KES 6,000-7,000):
  • Employee: 6% of Tier I amount (KES 7,000) = KES 420
  • Employer: 6% of Tier I amount (KES 7,000) = KES 420
  • Total Tier I: KES 840

Tier II (Tier I Limit to Upper Earnings Limit):

• Tier I Limit: KES 7,000/month
• Upper Earnings Limit: KES 36,000/month
• Contribution on Tier II (KES 7,001-36,000):
  • Employee: 6% of (actual salary – KES 7,000), capped at (KES 36,000 – KES 7,000) = KES 29,000
  • Employer: 6% of same
  • Maximum Tier II contribution: 6% × KES 29,000 = KES 1,740 each (employee/employer)

Total maximum NSSF:

• If salary ≥ KES 36,000/month:
  • Employee: KES 420 (Tier I) + KES 1,740 (Tier II) = KES 2,160
  • Employer: KES 420 (Tier I) + KES 1,740 (Tier II) = KES 2,160
  • Total: KES 4,320/month

Examples:

Example 1 (Salary KES 50,000/month – above cap):

• Tier I: KES 420 (employee) + KES 420 (employer) = KES 840
• Tier II: KES 1,740 (employee) + KES 1,740 (employer) = KES 3,480
• Total NSSF: KES 4,320

Example 2 (Salary KES 20,000/month – between Tier I and cap):

• Tier I: KES 420 + KES 420 = KES 840
• Tier II: 6% × (KES 20,000 – KES 7,000) = 6% × KES 13,000 = KES 780 each
  • Employee: KES 780, Employer: KES 780 = KES 1,560
• Total NSSF: KES 2,400

Example 3 (Salary KES 6,500/month – below Tier I limit):

• Tier I: KES 420 + KES 420 = KES 840
• Tier II: None (salary below KES 7,000 Tier I limit)
• Total NSSF: KES 840

Note: New NSSF rates significantly higher than old rates (old: KES 200 employee + KES 200 employer = KES 400 total). Full implementation phased in 2023.

2. National Hospital Insurance Fund (NHIF) Contributions

NHIF provides health insurance coverage for employees and dependents.

NHIF Contribution Rates (2024):

• Employee pays (employer withholds and remits)
• Employer pays nothing (employee-only contribution)
• Graduated rates based on gross salary:

Gross Monthly Salary (KES)	NHIF Contribution (KES)
Up to 5,999	150
6,000 – 7,999	300
8,000 – 11,999	400
12,000 – 14,999	500
15,000 – 19,999	600
20,000 – 24,999	750
25,000 – 29,999	850
30,000 – 34,999	900
35,000 – 39,999	950
40,000 – 44,999	1,000
45,000 – 49,999	1,100
50,000 – 59,999	1,200
60,000 – 69,999	1,300
70,000 – 79,999	1,400
80,000 – 89,999	1,500
90,000 – 99,999	1,600
100,000+	1,700

Example (Salary KES 50,000/month):

• NHIF: KES 1,200 (employee pays, employer withholds)

Coverage:

• Employee and registered dependents (spouse, children)
• Outpatient and inpatient services at NHIF-accredited facilities
• Quality varies (public healthcare system)
• Many employers provide additional private health insurance (see voluntary benefits below)

3. Affordable Housing Levy (AHL)

New mandatory contribution introduced in 2023 (Housing Levy Act 2024).

Housing Levy Rate:

• 1.5% of gross monthly salary (employee contribution)
• 1.5% of employee’s gross monthly salary (employer contribution)
• Total: 3% of gross salary

Purpose:

• Fund affordable housing projects in Kenya
• Employees may be eligible for affordable housing units or mortgage assistance (scheme details evolving)

Example (Salary KES 50,000/month):

• Employee Housing Levy: KES 50,000 × 1.5% = KES 750
• Employer Housing Levy: KES 50,000 × 1.5% = KES 750
• Total: KES 1,500

Note: New levy (implementation 2023-2024). Some legal challenges, but currently mandatory.

4. Pay-As-You-Earn (PAYE) – Income Tax

Kenya uses progressive income tax system.

Personal Income Tax Rates (2024):

Monthly Taxable Income (KES)	Annual Taxable Income (KES)	Tax Rate
Up to 24,000	Up to 288,000	10%
24,001 – 32,333	288,001 – 388,000	25%
32,334 – 41,667	388,001 – 500,000	30%
41,668 – 66,667	500,001 – 800,000	32.5%
Above 66,667	Above 800,000	35%

Tax reliefs (monthly):

• Personal relief: KES 2,400/month (KES 28,800/year) – all taxpayers
• Insurance relief: 15% of life/health insurance premiums paid, max KES 5,000/month
• NSSF relief: Contributions to registered pension/provident funds deductible (subject to limits)
• Affordable Housing Relief: Housing Levy contributions deductible from taxable income

Calculation example (Monthly salary KES 50,000):

1. Gross salary: KES 50,000
2. Less NSSF (employee): -KES 2,160
3. Less Housing Levy (employee): -KES 750
4. Taxable income: KES 47,090

5. Tax on KES 47,090:
   • First KES 24,000 @ 10% = KES 2,400
   • Next KES 8,333 (24,001-32,333) @ 25% = KES 2,083
   • Next KES 9,334 (32,334-41,667) @ 30% = KES 2,800
   • Remaining KES 5,423 (41,668-47,090) @ 32.5% = KES 1,762
   • Total tax before relief: KES 9,045
6. Less Personal Relief: -KES 2,400
7. PAYE: KES 6,645

Employer responsibilities:

• Withhold PAYE monthly
• Remit to Kenya Revenue Authority (KRA) by 9th of following month

5. Minimum Wage

Kenya has sector-specific minimum wages (no single national minimum).

Minimum Wage Rates (2024 – examples, vary by location/sector):

• Nairobi, Mombasa (urban areas):
  • General worker (unskilled): ~KES 15,000-18,000/month
  • Semi-skilled: ~KES 18,000-22,000/month
• Agricultural workers: Lower (varies by crop/region)
• Domestic workers: ~KES 10,000-15,000/month (plus accommodation, food)
• Security guards: Separate rates per Wages Order

Note: Professional sector salaries far exceed minimums (typical IT/BPO/professional salaries KES 40,000-200,000+/month).

Enforcement:

• Ministry of Labour
• Underpayment violations subject to fines

6. Severance Pay (Service Pay)

Statutory severance (called “service pay” in Kenya):

Entitlement:

• 15 days’ pay for each completed year of service
• Payable upon:
  • Redundancy (position elimination, business closure, restructuring)
  • Retirement (reaching retirement age)

When severance NOT payable:

• Voluntary resignation
• Dismissal for misconduct (summary dismissal)
• Fixed-term contract expiry (unless contract states otherwise)
• Termination during probation

Calculation:

• Based on gross salary (basic + allowances)
• “15 days’ pay” = (Monthly salary ÷ 30 days) × 15 days × years of service

Example:

• Employee: 5 years service, KES 50,000/month salary
• Severance: (50,000 ÷ 30) × 15 × 5 = KES 1,667 × 15 × 5 = KES 125,000

Payment timing:

• Must be paid on or before last working day

Note: Severance separate from notice pay – both may be due.

Employer Costs Summary

Total employer statutory costs on top of gross salary:

• Employer NSSF: Max KES 2,160/month (if salary ≥ KES 36,000)
• Employer Housing Levy: 1.5% of gross
• NHIF: KES 0 (employee pays)
• Total employer statutory cost: ~1.5-6% on top of gross (varies by salary level)

Example (Employee gross KES 50,000/month):

• Employer NSSF: KES 2,160
• Employer Housing Levy: KES 750
• Total: KES 2,910 (5.8%)
• Total employer cost: KES 52,910

Employee deductions from gross:

• Employee NSSF: Max KES 2,160
• Employee Housing Levy: 1.5% of gross
• NHIF: Graduated (KES 1,200 for KES 50,000 salary)
• PAYE: Progressive (varies, ~KES 6,645 for KES 50,000 example above)
• Total employee deductions: ~20-30% of gross

Net salary: ~70-80% of gross

Common Additional Benefits Provided by Employers

To attract and retain talent in competitive sectors (IT, BPO, finance), Kenyan employers often offer:

Health & Wellness:

• Private health insurance (medical cover) – very common (complements NHIF)
  • Covers employee and family (spouse, children)
  • Access to private hospitals/clinics (better quality than NHIF facilities)
  • Employer-paid or shared premium
  • Providers: AAR, CIC, Britam, Jubilee, Resolution, APA, others
• Group life insurance (death benefit, typically 1-3× annual salary)
• Group personal accident insurance
• Dental and optical cover (often included in medical or separate)

Financial:

• Performance bonuses (annual, quarterly, monthly – very common)
• 13th month salary (end-of-year bonus – some employers provide)
• Commission structures (sales roles)
• Long-service awards

Transportation:

• Transport allowance (very common – Nairobi traffic/commute costs)
• Company shuttle/bus (BPO sector often provides)
• Fuel allowance (for employees using personal vehicles)
• Company car (senior management, sales roles)

Meals:

• Lunch allowance or subsidized cafeteria (common in large companies)
• Meal vouchers

Housing:

• Housing allowance (especially for relocated employees or senior roles)
• Company housing (less common, some sectors)

Professional Development:

• Training and certifications (especially IT – AWS, Microsoft, Cisco; BPO – customer service certifications)
• Tuition reimbursement (degrees, professional qualifications – CPA(K), ACCA, etc.)
• Conference attendance

Communication:

• Mobile phone or airtime allowance (very common)
• Internet allowance (for remote workers)

Work-Life Balance:

• Additional annual leave (25-28 days common vs. 21 statutory)
• Flexible work (remote, hybrid)

Other:

• Pension/Provident fund (employer contributions beyond NSSF – voluntary but common in larger companies: 5-10% employer contribution)
• Employee assistance programs (EAP) (emerging in larger companies)
• Wellness programs (gym memberships, health screenings)
• Social events (team building, end-of-year parties)

An EOR ensures all mandatory statutory deductions (NSSF, NHIF, Housing Levy, PAYE) are calculated accurately, and competitive market-standard benefits can be included.

---

Payroll & Tax in Kenya

Payroll Currency

• All salaries paid in Kenyan Shillings (KES / KSh)

Payroll Cycle

• Monthly payroll most common (universal standard)
• Payment typically end of month (last business day or 28th-31st)
• Payment by bank transfer (M-Pesa mobile money or bank account) standard
  • M-Pesa: Very common for salary payments (Kenya’s mobile money system)
  • Bank account: Also common

Payslips:

• Must be provided (showing gross, deductions – NSSF, NHIF, Housing Levy, PAYE, net)

Personal Income Tax (PAYE)

See detailed tax rates in Benefits section above.

Summary:

• Progressive rates 10-35% on monthly taxable income
• Tax reliefs: Personal relief KES 2,400/month, insurance relief, NSSF/Housing Levy deductible

Payroll Deductions Summary

From employee gross salary:

• NSSF (employee): Max KES 2,160 (if salary ≥ KES 36,000)
• Housing Levy (employee): 1.5% of gross
• NHIF: Graduated (KES 150-1,700 based on salary)
• PAYE (income tax): Progressive 10-35% (after deductions and reliefs)
• Total employee deductions: ~20-30% of gross

Net salary: ~70-80% of gross

Employer Costs Summary

See detailed breakdown in Benefits section above.

Total employer statutory cost: ~1.5-6% on top of gross

• NSSF employer: Max KES 2,160
• Housing Levy employer: 1.5%

Employer Payroll Responsibilities

Kenyan employers must:

Monthly obligations:

• Calculate and withhold Employee NSSF (max KES 2,160)
• Pay Employer NSSF (max KES 2,160)
• Calculate and withhold Employee Housing Levy (1.5%)
• Pay Employer Housing Levy (1.5%)
• Calculate and withhold NHIF (graduated)
• Calculate and withhold PAYE (progressive tax after deductions/reliefs)
• Remit NSSF to NSSF by 15th of following month
• Remit NHIF to NHIF by 9th of following month
• Remit Housing Levy to Kenya Revenue Authority (KRA) by 9th of following month
• Remit PAYE to KRA by 9th of following month
• Issue payslips to employees

Annual obligations:

• File annual PAYE returns (P10) with KRA
• Provide employees with P9 forms (annual tax deduction certificates)
• Reconcile annual statutory payments

Ongoing:

• Maintain payroll records (recommended 7+ years)
• Register employees for KRA PIN (if don’t have), NSSF, NHIF
• Register as employer with KRA, NSSF, NHIF, Housing Levy
• Notify terminations
• Accurate tracking of leave, allowances, deductions

Kenya Revenue Authority (KRA):

• Tax authority
• iTax system: Online tax filing and payments (mandatory for most employers)

An EOR manages all payroll calculations, tax withholdings, NSSF/NHIF/Housing Levy remittances, KRA iTax filings, and compliance reporting for Kenya.

---

Employment Laws & Compliance in Kenya

Key Compliance Areas

1. Written Employment Contracts

• Mandatory for all employees
• Provided within 2 months of start
• Copy to employee

2. Employment Equality and Non-Discrimination

Kenya Constitution 2010 and Employment Act prohibit discrimination.

Protected characteristics:

• Race, ethnicity, tribe
• Sex/gender
• Pregnancy
• Marital status
• Health status (including HIV/AIDS)
• Religion
• Political affiliation
• Disability
• Age

Equal pay:

• Equal pay for work of equal value mandated

Discrimination prohibited in:

• Recruitment
• Pay and benefits
• Training, promotion
• Termination

Sexual harassment:

• Prohibited
• Employers must have anti-sexual harassment policies
• Serious misconduct ground for dismissal

3. Statutory Registration and Compliance

• Register with KRA (employer PIN)
• Register employees with KRA (individual PIN if don’t have)
• Register with NSSF as employer
• Register with NHIF as employer
• Register for Housing Levy

4. Minimum Wage Compliance

• Must pay at least sector-specific minimum wage
• Regular updates via Wages Orders (Ministry of Labour)

5. Working Time, Overtime, Rest

• Comply with 52-hour maximum work week (or 45-hour standard)
• Overtime at 1.5× rate (work beyond standard hours)
• Rest day/public holiday work at 2× rate
• 12-hour daily rest, 24-hour weekly rest

6. Leave Entitlements

• Annual leave (21 days)
• Sick leave (7 days full pay + 7 days half pay)
• Maternity leave (3 months paid)
• Paternity leave (2 weeks paid)
• Public holidays

7. Occupational Safety and Health

Occupational Safety and Health Act (OSHA), 2007:

• Employers must provide safe working environment
• Risk assessments
• Safety training
• Personal protective equipment (PPE)
• First aid facilities
• Accident reporting to Directorate of Occupational Safety and Health Services (DOSHS)
• Safety committees (workplaces with 20+ employees)

Specific sectors:

• Manufacturing, construction: Heightened safety requirements
• BPO: Ergonomics, workstation setup

8. Data Protection

Data Protection Act, 2019:

• Personal data must be processed lawfully, fairly, transparently
• Employee consent (employment contract is legal basis)
• Data security measures
• Employee rights (access, rectification, erasure)
• Data breach notification (within 72 hours to Office of the Data Protection Commissioner)

BPO sector:

• Often handles EU/US client data (must comply with GDPR, other regulations)
• Strict data security protocols

9. Trade Unions and Collective Bargaining

Labour Relations Act, 2007:

• Freedom of association (right to join or not join trade union)
• Collective bargaining rights
• Strikes and lockouts (regulated, mediation procedures required)

Trade unions:

• Active in some sectors (public sector, manufacturing, transport)
• Less prevalent in IT, BPO, professional services (though exist)
• Collective Bargaining Agreements (CBAs) can set terms above statutory minimums

Industrial disputes:

• Mediation via Labour Relations Board
• If unresolved, Employment and Labour Relations Court

Termination & Notice Periods

Notice Period Requirements

Statutory minimum notice periods (Employment Act):

Based on payment frequency (for employees earning <certain threshold):

• Daily/weekly paid: 24 hours notice
• Fortnightly paid: 7 days notice
• Monthly paid: 28 days (1 month) notice

For employees earning above certain salary threshold (professional/managerial):

• Notice periods as specified in employment contract (typically 1-3 months)
• Common: 1 month (junior), 2 months (mid-level), 3 months (senior/management)

Both employer and employee must provide notice (or payment in lieu).

During notice:

• Employee continues working, receives full salary
• Employer can release employee earlier (paying notice period salary)

Example:

• Employee (monthly paid, professional role, contract states 2 months notice) resigns: Must give 2 months notice or employer can require payment
• Employer dismisses: Must give 2 months notice or 2 months’ pay in lieu

Grounds for Termination

Employer can terminate for:

1. Mutual Agreement:

• Both parties agree to end employment (any terms negotiated)

2. Expiry of Fixed-Term Contract:

• Contract ends on specified date (no notice, no severance unless contract provides)

3. Redundancy:

• Position eliminated due to business closure, restructuring, economic reasons
• Must follow redundancy procedures:
  • Genuine business justification
  • Selection criteria (objective, non-discriminatory)
  • Consult with employees/union (if applicable)
  • Notify Ministry of Labour (30 days advance for 10+ employees)
  • Severance pay: 15 days per year of service
  • Notice period

4. Misconduct (Summary Dismissal for Gross Misconduct):

• Serious misconduct allowing immediate termination without notice or severance:
  • Theft, fraud, dishonesty
  • Violence, assault
  • Gross insubordination
  • Serious breach of safety rules
  • Intoxication (drugs, alcohol)
• Requires investigation, disciplinary hearing, employee given chance to respond
• Written dismissal letter with reasons

5. Poor Performance/Incompetence:

• Inability to perform job satisfactorily
• Requires prior warnings, performance improvement plan, opportunity to improve
• Notice period and severance

6. Incapacity (Medical):

• Prolonged illness preventing work
• After exhausting sick leave (reasonable period)
• Requires medical evidence
• Notice period and severance

7. Misconduct (Not Gross – Disciplinary Process):

• Less serious misconduct (repeated lateness, minor breaches)
• Progressive discipline (warnings)
• Can lead to dismissal with notice if repeated

Unfair/Unlawful termination:

• Termination without valid reason or fair procedure
• Discriminatory dismissal
• Dismissal of pregnant employee (unless gross misconduct or company closure)
• Retaliation for asserting rights, union activity

Fair Procedures for Dismissal

Best practice (Employment Act, case law):

For misconduct:

1. Investigation: Gather facts and evidence
2. Show-cause letter: Notify employee in writing of allegations, request written explanation
3. Disciplinary hearing: Allow employee to present defense, bring representative
4. Decision: Based on evidence and employee’s response
5. Dismissal letter: If proceeding, provide written notice with clear reasons, effective date
6. Right to appeal: Provide opportunity to appeal (internal)

For poor performance:

• Performance appraisals, feedback
• Verbal and written warnings
• Performance improvement plan (PIP) with support, targets, timeline
• Review and decision

For redundancy:

• Business justification
• Selection criteria (fair, objective)
• Consultation (employees, union if applicable, Ministry of Labour if 10+ affected)
• Notice and severance
• Explore alternatives (redeployment, voluntary redundancy)

Severance Pay (Service Pay)

See detailed calculation in Benefits section above.

Summary:

• 15 days’ pay per year of service
• Payable on redundancy, retirement
• Not payable on resignation, gross misconduct dismissal

Dispute Resolution

If employment dispute arises:

1. Internal grievance:

• Attempt to resolve with employer (internal grievance procedures)

2. Labour Officer (Ministry of Labour):

• File complaint with Labour Officer
• Mediation/conciliation

3. Employment and Labour Relations Court (ELRC):

• If mediation fails, file claim in ELRC
• Hears unfair dismissal, discrimination, unpaid wages, severance, etc.
• Time limit: Generally 60 days from termination (or dispute arising) to file claim

Remedies for unfair dismissal:

• Reinstatement (rare in practice)
• Compensation:
  • Notice pay (if not given)
  • Severance pay (if redundancy)
  • Compensation for unfair dismissal: Up to 12 months’ gross pay (court’s discretion based on circumstances)
  • Accrued leave, unpaid wages

Burden of proof:

• Employer must prove dismissal was fair (valid reason, fair procedure)

Immigration and Work Permits

Kenyan citizens:

• Unlimited right to work in Kenya

East African Community (EAC) citizens:

• EAC member states: Kenya, Uganda, Tanzania, Rwanda, Burundi, South Sudan, DR Congo (as of 2024)
• Free movement of workers under EAC Common Market Protocol
• EAC citizens can work in Kenya with EAC Work Permit (simplified process, lower fees)

Non-Kenyan, non-EAC nationals (expatriates):

• Require work permit to work legally in Kenya

Work permit types (Classes):

1. Class A – Specific Manufacturing:

• For manufacturing sector (specific approval required)

2. Class B – Renewable:

• Most common for expatriates
• For specific employment with specific employer
• Requires employer sponsorship
• Demonstrates specialized skills, no suitable Kenyan available
• Duration: Initially 2 years, renewable for 2 years at a time

3. Class C – Investor/Self-Employed:

• For investors, business owners, self-employed professionals
• Requires minimum investment (typically USD $100,000+)

4. Class D – Permanent (Resident Permit):

• For long-term residents (after many years in Kenya, marriage to Kenyan, etc.)
• Allows work without restrictions

5. Class F – Refugee:

• For refugees (separate category)

6. Class G – Dependent Pass:

• For dependents of work permit holders
• Generally cannot work (unless obtain separate work permit)

Application process (Class B typical):

1. Employer applies to Department of Immigration on employee’s behalf
2. Provides: Employment contract, employee qualifications/CV, company registration documents, justification for foreign hire, advertisement for role (proof of local recruitment efforts)
3. Pay fees (approximately KES 200,000-300,000 for 2-year permit)
4. Employee obtains entry visa from Kenyan embassy/consulate abroad
5. Upon arrival: Register, obtain work permit card (alien ID)

Duration: 2-8+ months (varies, can be lengthy)

Employer obligations:

• Apply for work permit on employee’s behalf
• Demonstrate no suitable Kenyan candidate available
• Pay permit fees
• Ensure employee has valid work permit before commencing employment
• Cannot employ foreign nationals without valid authorization (penalties: fines, imprisonment, deportation of employee)

Restrictions:

• Certain jobs reserved for Kenyans (e.g., basic clerical, receptionists, secretarial roles – unless highly specialized)
• Expatriate quotas in some sectors

Family members:

• Dependents can apply for Class G Dependent Pass
• To work, need separate work permit

An EOR with Kenyan entity can sponsor and employ foreign workers, navigating Department of Immigration procedures and work permit applications.