Atwoli backs NSSF move to have employees contribute Sh2000 up from Sh200
The move by the National Social Security Fund (NSSF) to have Kenyans dig deeper into their pockets and contribute Sh2,000 from the previous Sh200 has elicited public uproar from some Kenyans but has on the other hand been welcomed by some leaders.
Secretary General of Central Organization of Trade Unions (COTU) Francis Atwoli defended the move saying that the upward revision of the rates would be beneficial to Kenyans in the long run as it will cushion them upon retirement.
“Consequently, the move to effectively implement the NSSF Act, 2013 is welcome considering it makes it mandatory for employers to ensure that workers have a provident fund and pension scheme,” Atwoli stated.
According to Atwoli, many workers have been contributing to and receiving funds from the provident fund which is a lump sum payment, leaving them exposed to old age poverty with no social security covering them.
“Noteworthy, the NSSF Act provides that an employer may opt out of Tier II, as provided by the NSSF, for a better scheme. This means that over and above the lump sum payment received at a go, upon retirement or as provided by the NSSF Act, 2013, Kenyan workers will be entitled to monthly benefits, upon retirement, as they would have respectively contributed under the Tier II,” said Atwoli.
Atwoli cleared the air that the NSSF deductions are not a form of tax but a fund that employees will have access to upon retirement or as provided for by the NSSF Act, 2013.
The government seeks to increase monthly remittance from Sh200 to Sh2,160 for employees earning above Sh18,000.
The decision was made following a ruling by the Court of Appeal that upheld the 2013 NSSF Act as legal.
“We find that the Employment and Labour Relations Court (ELRC) made a mistake in declaring the Act unconstitutional when it had no jurisdiction to question validity of the law as that was a preserve of the High Court,” ruled the judges.
In September 2022, the Labour and Employment Relations Court declared the bid unconstitutional, null and void stating that the NSSF Act,2013 violated the Constitution because there was no public participation prior to its enactment.
The judges however agreed that enactment of the NSSF Act, 2013 did not require participation of the Senate and that the employment and labour court judges made an error by failing to establish that the Act did not interfere with functions of county governments.
