10/02/2023
KENYAN WORKERS WELCOME NEW NSSF RATES
Following the decision of the Court of Appeal to stay the whole judgment of the Employment and Labour Relations Court (ELRC) on the National Social Security Fund (NSSF) Act of 2013, COTU (K) welcomes the decision by the NSSF Board of Trustees to effective immediately implement the NSSF Act, 2013.
Primarily, social security is a human right that focuses on addressing the universal need for protection against certain life risks and social needs. This explains why the ILO, under Convention No. 102 of 1952, sets out the minimum standards for the provision of social security. Equally, the Constitution of Kenya 2010, under Article 43 on Economic and Social Rights, provides that every Kenyan Citizen is entitled to a pension and social security.
Consequently, the move to effective immediately implement the NSSF Act, 2013 is welcomed considering it makes it mandatory for employers to ensure that workers have a provident fund and a pension scheme.
Heretofore, many workers have only been contributing to and receiving funds from the provident fund, which is a lump sum payment that workers have been receiving at a go, (Tier I). After receiving the lump sum from the provident fund, Kenyan workers have been left exposed to old age poverty with no social security covering them.
Moving forward, Kenyan workers will be contributing to and receiving funds from the pension fund under the NSSF which is a combination of both the provident fund (Tier I) and the pension fund (Tier II). 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.
Finally, COTU (K) would like to remind Kenyan workers that the NSSF deduction is not a tax. These are funds that they will have access to upon retirement or as provided for by the NSSF Act, 2013. Further, COTU (K) is ready, willing, and available to have a high-level tripartite consultation, as provided for in ILO Convention 144, to discuss and resolve some of the teething problems that might be associated with the seamless implementation of the NSSF Act, 2013.
But much more importantly, COTU (K) would like to call upon the NSSF Board of Trustees to appoint a very competent Managing Trustee/CEO who will live above corrupt persuasion.
Ends.
