Kikuyu, Luhya 

East Africa Time Zone (UTC + 03:00)

Undoubtedly, payroll is a critical process for any organization. Pay cycle in Kenya refers to the period for which an organization pays its employees, and this can vary depending on the pay frequency that the organization chooses to adopt.

The payroll frequency in Kenya is followed as per the following categories:

Casual employees- Wages are paid either at the end of the workday or at the end of the week.

Employees with an indefinite term employment contract- Wages are paid monthly and must be paid by the last working day of the month.

There is no 13th month pay in Kenya.

In Kenya, the national minimum wage is 15120 KES per month as of May 2022.

Under these statutory regulations overtime should be payable at the rates of one and one-half time hourly rate on weekdays, and at the rate of twice the basic hourly rate on Sundays and public holidays.

There are different Regulations of wage orders in force, covering different sectors of the economy.

• Tax records must generally be kept for a minimum of five years. 
• Tax records include employees' names, Personal Identification Numbers (PINs), gross income, nature of payments, and amount of tax withheld. 
• Social tax documents generally should be kept for five years.

Increase in NSSFC contribution percentage:
With effect from February 15, 2023, all the employers who have one or more employees must register with NSSF, keep updated records of payments, register all  employees  with  NSSF  and  make mandatory contributions to NSSF.
An increase in the deduction from the  employee's  pay  from  Sh.  200.00  to  Sh. 1,080.00 per month, and the same goes for the employer.

The law insinuates promotion of equal opportunities among employees through eliminating discrimination in employment policies and practices. The Employment Act prohibits discrimination in respect of recruitment.

However, the employment laws also provide that it is not discriminatory to:

• take measures for affirmative action that are consistent with the promotion of equality or the elimination of discrimination in the workplace
• distinguish, exclude or give preference to any person based on an inherent requirement of a job;
• employ a citizen under the national employment policy, or restrict access to certain categories of employment where it is necessary for the interest of state security.

The required documents include:

• The national ID card 
• The NHIF card
• The NSSF card
• The KRA PIN certificate
• Bank details proof (ATM Card/bank statement copy)

Other documents for those who have other deductions other than statutory,

• For those with loans, the executed offer letter from the bank / or the loan statement
• For those who make Pension contributions, evidence of the same e.g. copy of the contract 
• For those with insurance policies, evidence of the same e.g. copy of the contract.
• For foreign employees (not local employees, by whichever title), additionally (to the aforementioned), there needs to be:
•  A work permit,
• Alien ID 

(These documents show that the employee is documented, validates their stay, and ability to work in the country).

And any other documents the employer may deem necessary.

The probationary period is set at a maximum of six months in Kenya.

This period may, however, be further extended for a period of not more than six months. The employee’s consent is required for such an extension.

Public Holiday

There are 13 public holidays. If a holiday falls on a Sunday, then the proceeding Monday is commonly observed as a holiday.

• Jan. 1: New Year's Day
• Apr. 7: Good Friday
• Apr. 10: Easter Monday
• Apr. 23: Eid al-Fitr
• May 1: Labor Day
• June 1: Madaraka Day
• June 29: Eid al-Adha
• Oct 10: Huduma Day
• Oct. 20: Mashujaa Day
• Dec. 12: Jamhuri (Independence) Day
• Dec. 25: Christmas Day
• Dec. 26: Boxing Day

For every 12 – month period, an employee is entitled to a total of 14 days of sick leave. 

100% of the regular pay rate is paid for the first 7 days and 50% for the remaining 7 days. To be eligible for this leave, the employee must have completed at least 2 months of employment. Also, the employee must be able to provide a medical certificate.

Women are entitled to 91 days of maternity leave paid at 100% of the regular pay rate. To be eligible, the woman must give at least 7 days’ notice to their employer when the leave is intended to be taken and must be able to provide a medical certificate.

Fathers are entitled to 2 weeks of paid paternity leave.

Parents who are preparing to adopt a child are eligible for one month of pre-adoptive leave with full pay. Parents however will be required to provide 14 days' notice to their employer and show the relevant adoption papers as proof.

Where the contract is to pay wages or salaries periodically at intervals of or exceeding one month, a contract terminable by either party at the end of the period of twenty-eight days next following the given of notice in writing.

This sub-section does not apply in cases when the contract itself, or a given collective agreement, requires a longer period of notice. If an employer does not give notice, he or she should pay to the employee an amount equal to his or her wages for that period.

Practice in the Industrial Court has produced some rules, thereby modifying the strict regulations of the Act. The period of advance notice for employees who have worked for five years or less has generally been adjusted to a minimum of one month. When the employee has worked for more than five years, however, it is at least two months. And the notice must be in writing.

The individual employee is entitled to two basic rights, severance pay, and payment in lieu of notice. The rates of payment may depend on the agreement, but many ranges from fifteen to thirty days basic wage or salary for every completed year of service. Following the jurisprudence of the Industrial Court, it has been accepted that an employer whose position improves and wishes to employ after a financial crisis, must give priority to the employees formerly declared redundant.

All foreign workers must obtain the proper visas and entry permits in order to work legally in Kenya. Visas are required for most foreign nationals, including U.S. nationals, to enter Kenya.

Work permits are divided into 7 classifications (D, I, B, A, G, K, and M).

• Class D allows employees to work for a specific employer for a specific position, and
• Class G permits are given to traders, investors, and consultants.
• Class I, B, A, and K permits are given to prospectors, investors in agriculture, refugees, and those receiving income from foreign (non-Kenyan) sources.

Permits are issued by the Immigration Department and generally are valid for two years. Applicants must file Form 3 and submit a letter from employers and pay a processing fee in order to apply.

Employers can carry out background checks on employees and applicants. There is no law prescribing how these should be carried out. However, employers should be careful not to infringe on employees’ right to privacy, which is protected under the Constitution and the Data Protection Act as well as other sector-specific laws such as the Health Act.

It does not make any difference if the employer conducts its own checks or hires a third party to do the checks. However, while conducting background checks, the employer or third party must adhere to the principles of data protection set out in the Data Protection Act.