Workers with superior pension schemes could be exempt from higher contributions to the National Social Security Fund (NSSF) if a deal between workers’ unions and the fund is endorsed by the Supreme Court.
In a proposal that is pending before the apex court, lawyers representing various parties are negotiating to bring the matter to a close.
The matter escalated to the Supreme Court after the appellate court overturned a decision blocking the implementation of the NSSF Act 2013, which saw the monthly contributions increase ten-fold.
“We have instructions to initiate negotiations on a mutually agreeable settlement of the dispute embodied in the above cases, which essentially revolves around the subjection of previously exempt employees to mandatory NSSF membership,” the letter by lawyer Muthomi Thiankolu, who is representing the County Pensioners Association stated.
In the draft consent sent to Fred Ngatia, who is representing NSSF, Dr Thiankolu stated, “A declaration is hereby issued to the effect that employees who are in pension schemes that offer benefits that are equal to or superior to those offered by the NSSF are exempt from the provisions of the NSSF Act, 2023.”
The NSSF Act, 2013 increased salaried employees’ monthly deductions from Sh200 to Sh600 for the lowest earner and from Sh320 to Sh1,080 for top earners under a graduated scale. The upper limits on contributions are to rise every year.
