NAIROBI, Kenya – The National Treasury Cabinet Secretary, John Mbadi, faces a parliamentary summons to explain why his office has not addressed widespread illegal salary deductions that leave thousands of civil servants with less than a third of their basic pay—violating Kenya’s Employment Act, 2007.
Under the law, employers are prohibited from deducting more than two-thirds of an employee’s basic pay, ensuring workers retain at least one-third of their salary after deductions.
Employers breaching this rule risk criminal charges and are liable to refund any illegally withheld funds.
However, recent findings by the Public Service Commission (PSC) reveal alarming non-compliance.
Of the 79,453 civil servants in the country, 17,132—21.6%—earn less than a third of their basic salary.
Counties have not been spared, with Kiambu topping the list, where 2,248 workers fall below the mandated threshold.
Parliament’s Public Accounts Committee (PAC), chaired by Butere MP Tindi Mwale, attributes the crisis to a series of tax hikes introduced by the Kenya Kwanza administration.
Over the past two years, civil servants have faced a 1.5% Housing Levy deduction and an additional 2.75% deduction for the Social Health Insurance Fund (SHIF).
These new measures, coupled with statutory obligations like PAYE and loan repayments, have pushed many employees below the one-third salary threshold.
“The problem stems from the excessive deductions triggered by new tax measures, leaving employees with barely enough to survive,” Mwale remarked during a recent committee meeting.
Auditor General Nancy Gathungu echoed similar concerns in her 2022/23 report, flagging state departments for non-compliance with the law.
The Roads Department, for instance, was highlighted for having hundreds of staff earning less than the legally required threshold.
PAC has demanded that state departments and Treasury officials account for the breaches.
Lugari MP Nabii Nabwera called for urgent consultations with the Treasury to realign the law with the evolving tax realities.
“We need a comprehensive review to ensure public servants’ take-home pay adheres to legal requirements,” Nabwera urged.
Rarieda MP Otiende Amolo added his voice, suggesting a policy overhaul.
“As Parliament, we must engage the Treasury and recommend changes to safeguard employees from excessive deductions,” he said.
The legislators’ demands follow revelations that over 10,000 public servants earned below the one-third salary mark in the 2021/22 financial year—a figure that has since grown.
The PAC now wants CS Mbadi to clarify what measures, if any, his office is implementing to address the issue.
The committee is also calling on departmental heads to explain their continued flouting of the law.
The outcome of these engagements will be critical in determining whether civil servants can expect relief from the financial strain caused by excessive deductions.
Under the law, employers are prohibited from deducting more than two-thirds of an employee’s basic pay, ensuring workers retain at least one-third of their salary after deductions.
Employers breaching this rule risk criminal charges and are liable to refund any illegally withheld funds.
However, recent findings by the Public Service Commission (PSC) reveal alarming non-compliance.
Of the 79,453 civil servants in the country, 17,132—21.6%—earn less than a third of their basic salary.
Counties have not been spared, with Kiambu topping the list, where 2,248 workers fall below the mandated threshold.
Parliament’s Public Accounts Committee (PAC), chaired by Butere MP Tindi Mwale, attributes the crisis to a series of tax hikes introduced by the Kenya Kwanza administration.
Over the past two years, civil servants have faced a 1.5% Housing Levy deduction and an additional 2.75% deduction for the Social Health Insurance Fund (SHIF).
These new measures, coupled with statutory obligations like PAYE and loan repayments, have pushed many employees below the one-third salary threshold.
“The problem stems from the excessive deductions triggered by new tax measures, leaving employees with barely enough to survive,” Mwale remarked during a recent committee meeting.
Auditor General Nancy Gathungu echoed similar concerns in her 2022/23 report, flagging state departments for non-compliance with the law.
The Roads Department, for instance, was highlighted for having hundreds of staff earning less than the legally required threshold.
PAC has demanded that state departments and Treasury officials account for the breaches.
Lugari MP Nabii Nabwera called for urgent consultations with the Treasury to realign the law with the evolving tax realities.
“We need a comprehensive review to ensure public servants’ take-home pay adheres to legal requirements,” Nabwera urged.
Rarieda MP Otiende Amolo added his voice, suggesting a policy overhaul.
“As Parliament, we must engage the Treasury and recommend changes to safeguard employees from excessive deductions,” he said.
The legislators’ demands follow revelations that over 10,000 public servants earned below the one-third salary mark in the 2021/22 financial year—a figure that has since grown.
The PAC now wants CS Mbadi to clarify what measures, if any, his office is implementing to address the issue.
The committee is also calling on departmental heads to explain their continued flouting of the law.
The outcome of these engagements will be critical in determining whether civil servants can expect relief from the financial strain caused by excessive deductions.
