Labour laws mostly comply with international standards and conventions

Employment in Kenya is mainly directed by the Employment Act (2007), Work Injury and Benefits Act (2007) and Occupational Safety and Health Act (2007). These laws specify, inter alia, rules governing wages, leave and rest, health and safety, termination of employment etc.

Categories of contract

The Employment Act (2007) specifies four types of contracts:

  • Contract for an unspecified period of time. The company hires an individual for an indefinite period of time. A probationary period (up to six months, renewable once if agreed by the employee) might be included.
  • Contract for specified period of time. The contract is automatically terminated at end of the period.
  • Contract for a specific task (piecework employment). The company hires a consultant or independent contractor to execute some pre-defined work.
  • Contract for casual employment. The company engages an individual for no more than one day (24 hours) at a time and pays wages every day.

Working hours and overtime

The normal working hours in a week shall not exceed 52 hours for day employees and 60 hours for night duty employees. In addition, the employee is entitled to one day of rest per week.

Subject to compensation, extra hours are allowed. Extra-hours are generally paid at the rates of one and one-half times the hourly rate on weekdays, and twice the hourly rate on rest days and public holidays. The overtime plus time worked in normal hours for employees engaged in night work cannot not exceed 140 hours per week and 116 hours for all other employees in any two consecutive weeks.

Employment rights and benefits

In Kenya, workers have the following rights

  • In every 12 consecutive months of service, fixed-term and permanent employees are entitled to 21 working days of leave with full pay (excluding public holidays).
  • In addition to annual leave, women employees are entitled to three months maternity leave. Male employees are entitled to two weeks paternity leave.
  • After two consecutive months of service, an employee is entitled to sick leave (at least 7 days with full pay, thereafter 7 days with half-pay) in each period of 12 consecutive months of service. This might vary by industry.
  • In case of redundancy, severance pay applies. The employee has to receive an indemnity corresponding to 15 days per year worked.
  • If the employee is not a member of a registered pension or provident fund or the National Social Security Fund, then the company has to pay the employee service pay for every year worked at the end of the permanent/monthly employment contract.
  • Employees shall operate in safe working conditions.

Labour relations

The Labour relations Act (2007) regulates employer-employee relations. Every employee has the right to join a trade union. Employees cannot be penalized or discriminated against by their employer for opting to join a trade union.

Dismissal of employees and employment disputes

Before the employee can be dismissed, the employer is required to give a notice of termination in accordance with the contract (except for casual employment, this contract can be terminated without notice at the end of any day). In case of termination without notice, the firm has to pay in lieu of notice. The payment must be in line with the terms stipulated in the contract.

Disputes between employers and employees should first be addressed by the labour officer or via a conciliation. If an agreement is reached, the agreement has to be approved by the Employment and Labour Relations Court. As a last resort, the dispute may be lodged in the Employment and Labour Relations court.

Any enterprise operating in Kenya (local or foreign) can recruit foreign workers for any skilled position if Kenyans are not available.

Foreign workers can work in Kenya as soon as they hold a valid work permit. Requests made by/for key personnel are usually accepted.

Employee costs estimation calculator

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Occupations subject to a minimum wage

For certain occupations, the government regularly defines basic minimum wages by occupation and location.

Basic minimum monthly wages (exclusive of housing allowance) for workers located in main cities (Nairobi, Mombasa and Kisumu) are listed in the table below.

Occupation KSH USD
General labourer including cleaner, sweeper, gardener, children’s ayah, house servant, day watchman, messenge 12,927 129
Miner, stone cutter, turn boy, waiter, cook, logger, line cutter 13,961 139
Night watchman 14,421 144
Machine attendant, sawmill sawyer, machine assistant, mass production machinist, shoe cutter, bakery worker, bakery assistant, tailor’s assistant 14,651 146
Machinist (made-to-measure), shoe upper preparer, chaplis maker, vehicle service worker (petrol and service stations), bakery plant hand, laundry operator, junior clerk, wheeled tractor driver (light) 16,725 166
Printing machine operator, bakery machine operator, plywood machine operator, sawmill dresser, shop assistant, machine tool operator, dough maker, table hand baker or confectioner, copy-typist, driver (cars and light vans) 17,448 174
Pattern designer (draughts-man), garment and dress cutter, single hand oven man, charge-hand baker, general clerk, telephone operator, receptionist, storekeeper 19,910 198
Tailor, driver (medium sized vehicle) 21,943 218
Dyer, crawler tractor driver, salesman 24,224 241
Saw doctor, caretaker (buildings) 26,808 267
Cashier, driver (heavy commercial vehicle included), salesman 29,169 290
Ungraded artisan 17,448 174
Artisan Grade III 21,943 218
Artisan Grade II 23,700 236
Artisan Grade I 29,169 290

Note: Exchange rate: 1 USD =100.458 KES
Source: The Regulation of Wages-General Amendment Order (2017)

Typical wages applied for other occupations

The table below provides examples of typical monthly wages applied.

Occupation USD
Skilled technician 330
Graduate entry [270;440]
Middle manager [500;670]
Senior manager [1,350;1,680]

Source: IGuide-Kenya. 2015 figures.

Social security contributions


Contributions to the pension fund are mandatory. Both the employer and the employee contribute. The employer contribution shall come directly from the employer. The employer has to deduct and remit contributions in full by the 15th of the following month.

Contributions under the NSSF act of 2013

Both employees and employers contribute to the NSSF (at the same rate).

The employer contribution cannot exceed 6% of monthly pensionable earnings. Pensionable earnings include salary, fixed amount allowances and benefits.

The contribution to be paid by the employer is a function of many factors, including the contribution rate (6%), the Lower Earning Limit (LEL), the Upper Earning Limit (UEL) and the National Average Earnings (NAE). The LEL corresponds to the gazetted average statutory minimum monthly basic wage. The UEL is four times the NAE as published by the Kenya Bureau of Statistics in the Economic Survey for the prior year. So, UELt= 4 x NAE t-1 , with t the year

The table presented below provides guidelines for the computation of contributions.

Employee Earnings (EA) Tier I Contribution Tier II Contribution Total Employer Pension Contribution
EA<=LEL 0.06 x EA 0 0.06 x EA
LEL<EA<=UEL 0.06 x LEL 0.06 x (EA-LEL) 0.06 x EA
EA>=UEL 0.06 x LEL 0.06 x (UEL-LEL) 0.06 UEL

*Disclaimer: Estimates of the “Cost calculator” are based on data provided by related local stakeholders. KenInvest will not be liable for any computation made on outdated information. Rates apply for Nairobi, Mombasa and Kisumu cities.