Lawyer Files Case Against Govt’s Hike in NSSF Deduction Rates
City lawyer John Maina Ndegwas has taken legal action at the Milimani Law Courts to contest the upcoming National Social Security Fund (NSSF) deductions set to be implemented next month.
Maina argues that the economic consequences of this implementation will have a detrimental impact on Kenya’s economy, as increased operational costs may force employers to declare their employees redundant.
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According to the lawyer, the proposed deductions come at a time when Kenyans are grappling with the high cost of living and shrinking pay slips due to a depressed economy. The petition emphasizes the need for urgent intervention to prevent further economic strain.
He is seeking the court’s certification of the matter as urgent and requests a temporary order to restrain the NSSF board from implementing the contribution rates for 2024.
Court papers highlight the lack of guidance from the NSSF board on the implementation of the 3rd schedule of the NSSF Act 2013, causing confusion and anxiety in both the public and private sectors of Kenya’s economy.
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The new rates indicate an increase in the lower earnings limit to Ksh.7,000, up from Ksh.6,000. Employees in this category will now contribute Ksh.420, compared to the current Ksh.360.
Concurrently, the Upper Earnings Limit has been raised to Ksh.29,000 from Ksh.18,000, resulting in a contribution of Ksh.1,740, up from Ksh.1,080, for most workers. Employers will continue to match each contribution, as per the existing practice.
These rates will be applicable until the next review in January 2025. The phased implementation of the new deduction plan, initiated last year, will gradually increase rates over the course of five years.
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Lawyer Files Case Against Govt’s Hike in NSSF Deduction Rates
