7 June 2014

Kenya: Unions Go to Court Over New NSSF Rates

SEVEN trade unions moved to court yesterday to stop the National Social Security Fund from implementing the 2013 Act. The Act seeks to increase employees salary monthly deductions from Sh200 to Sh600 for the lowest earner and Sh320 to Sh1,080 for higher earners.

Kenya County Government Workers Union, Kenya Quarry and Mine Workers Union, Kenya Building and Construction Union, Timber Furniture and Allied Employees Union, Kenya Union of Entertainment, Music Union of National Research Institute and Kenya Glass Workers Union want NSSF restrained from increasing the monthly contributions until the case is heard and determined.

The Central Organisation of Trade Unions and Federation of Kenya Employers have been named as interested parties. In filing the case yesterday before High Court judge Mumbi Ngugi, lawyer George Kithi for KCGWU and Okweh Achiando for the other six unions, said that Sections 18, 19 and 20 of the Act are inconsistent with Articles 24, 26, 27, 28 and 36 of the constitution.

They said their members are likely to suffer prejudice and injustice if the illegal action is allowed. The lawyers are seeking orders to stop NSSF from implementing, gazzeting or advertising the rules in respect to the 2013 Fund Act.

The unions are also seeking an order to stop the fund from demanding, compelling or requiring mandatory registration, enrollment or listing of any employer or employee whether registered or not to the retirement benefit scheme so as to contribute their earnings to NSSF. In a certificate of urgency, they said some workers do not meet the 70 per cent threshold of the basic salary.

The lawyers said the current Pay As You Earn is a burden to Kenyans and the social services returns is not in accordance with the Kenyan PAYE remits compared to Western countries. Justice Ngugi referred the case to the Industrial Court to be mentioned on Monday for direction.

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