Payroll and Benefits Guide Kenya
Last updated: Mar 03, 2026
Contribution
| Employer Payroll Contributions | |
| 6.00% | National Social Security Fund (NSSF) –
Tier 1 applied on income up to 9,000 KES Tier 2 applied on income up to 108,000 KES |
|
1.50%
|
National Housing Development Fund (NHDF)
|
|
50 KES per employee
|
National Industrial Training Levy (NITA) |
| 7.5%+50 KES |
Total Employment Cost |
| Employee Payroll Contributions | |
| 6.00% | National Social Security Fund (NSSF) –
Tier 1 applied on income up to 9,000 KES Tier 2 applied on income up to 9,000 KES |
|
1.50%
|
National Housing Development Fund (NHDF) |
|
2.75%
|
Social Health Authority (SHA) |
| 10.25% |
Total Employment Cost |
| Income Tax | |
| 10.00% | On the first 288,000 KES per year |
| 25.00% | On the next 100,000 KES per year |
| 30.00% | On the next 5,612,000 KES per year |
| 32.5% | On the next 3,600,000 KES per year |
| 35.00% | On all income over 9,600,000 per year |
Employer taxes
Employee taxes
Minimum Wage
General
The general monthly minimum wage is 15,201.65 KES.
Specific industries and cities might have a higher minimum wage in place e.g. for cleaners, gardeners, security guards, cashier or heavy commercial driver.
MINIMUM WAGE (PER MONTH)
Payroll
Payroll Cycle
In Kenya, the payroll frequency is monthly. Work between the first and last day of the month is typically paid on the last day of the month. Casual employees are to be paid at the end of the workday.
13th Salary
There are no provisions in the law.
Working Hours
General
The standard workweek in Kenya is 45 hours per week.
The New Labour Law states that employees should not work more than 56 hours per week and the maximum overtime per day should not exceed 4 hours. There are also new laws for shift work patterns.
Overtime
The maximum ordinary hours vary slightly based on the industry-specific Regulation of Wages Orders, but the law sets an absolute upper limit on total hours worked.
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Maximum Ordinary Hours (General): The standard work limit for most employees is often stipulated by contracts or orders as 45 hours per week (e.g., 8 hours Monday–Friday and 5 hours on Saturday). However, the general maximum for which normal wages apply is 52 hours per week for day workers and 60 hours per week for night workers. Overtime is any hour worked beyond these standard hours.
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Absolute Maximum Work Time (Bi-Weekly Cap): The total working time, including overtime, is strictly capped over any period of two consecutive weeks (a fortnight):
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Regular Employees: Maximum of 116 hours over two weeks.
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Night Workers: Maximum of 144 hours over two weeks.
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Consent: Employees cannot generally be forced to work overtime, as forcing it may contravene minimum conditions of employment. However, employers can request a reasonable amount of overtime.
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Exemptions: Employees in managerial or supervisory positions are typically exempt from the statutory overtime payment provisions.
Mandatory Overtime Pay Rates
Overtime compensation is mandatory and is calculated as a minimum premium percentage of the employee’s normal hourly rate.
| Day/Condition | Minimum Compensation Rate (Statutory) | Total Pay Rate | Notes |
| Normal Overtime (Working Days) | 1.5 times the normal hourly rate (Time and a half). | 150% | Applies to hours worked beyond the normal maximum hours per week (e.g., beyond 45 or 52 hours). |
| Weekly Rest Day (e.g., Sunday) | 2 times the normal hourly rate (Double time). | 200% | Applies to all hours worked on the employee’s designated normal rest day. |
| Public Holiday Work | 2 times the normal hourly rate (Double time). | 200% | Applies to all hours worked on an official public holiday. |
| Night Work Premium | 1.25 times the normal hourly rate. | 125% | This is the minimum required compensation for work performed during the night shift (typically 10:00 PM to 6:00 AM) if it does not constitute overtime. |
Compensation Method:
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Monetary Pay: The law stipulates the minimum monetary compensation.
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Time Off in Lieu (TOIL): Certain sector-specific regulations, such as those for the Hotels and Catering Industry, may allow the employer to compensate for work on a public holiday with time off with full pay in lieu of the overtime payment, by agreement.
Leave
Annual Leave (vacation)
An employee is entitled to a minimum of 21 working days of paid annual leave per year. Employers typically decide to implement policies which allows workers to use leave from the start of employment.
With the employee’s consent, it is possible to divide the minimum annual leave entitlement into different parts to be taken at different intervals, however, the Labour Law does entitle an employee to 10 consecutive calendar days of leave at least once out of the minimum 15 calendar days leave.
PTO carryover
In Kenya, statutory annual leave cannot be forfeited. Unused leave may be carried forward by agreement, but it is generally expected to be taken within 18 months. A blanket “use-it-or-lose-it” policy is not lawful, and unused leave must be paid out on termination.
Note:
- Zapeo states: the remainder of the annual leave with pay shall be taken not later than eighteen months from the end of the leave-earning period referred to in subsection (1)(a), being the period in respect of which the leave entitlement arose.
Public Holidays
Public holidays that fall on a Sunday are moved to the following Monday as a day off in lieu.
The religious holidays are determined by the lunar cycle and will be confirmed nearer the date of the holiday.
| Date | Day | Holiday | Notes |
|---|---|---|---|
| 1 January 2026 | Thursday | New Year’s Day | Standard holiday |
| 20 March 2026 | Friday | Idd-ul-Fitr (End of Ramadan) | Standard holiday |
| 3 April 2026 | Friday | Good Friday | Standard holiday |
| 6 April 2026 | Monday | Easter Monday | Standard holiday |
| 1 May 2026 | Friday | Labour Day | Standard holiday |
| 27 May 2026 | Wednesday | Idd-ul-Adha (Feast of Sacrifice) | Standard holiday |
| 1 June 2026 | Monday | Madaraka Day | Standard holiday |
| 10 October 2026 | Saturday | Utamaduni Day (formerly Moi Day, then Mazingira Day) | Standard holiday |
| 20 October 2026 | Tuesday | Mashujaa Day (Heroes’ Day) | Standard holiday |
| 12 December 2026 | Saturday | Jamhuri Day | Standard holiday |
| 25 December 2026 | Friday | Christmas Day | Standard holiday |
| 26 December 2026 | Saturday | Boxing Day | Standard holiday |
Sick Days
After two consecutive months of service, employees are entitled to sick leave of up to 30 days at full salary followed by 15 days at half salary in each period of 12 consecutive months of service.
All sickness leave requires a professional medical certificate of incapacity to work.
Maternity Leave
Women are entitled to three months of maternity leave paid at 100% of the regular pay rate. To be eligible, the woman must give at least seven days’ notice to their employer when the leave is intended to be taken and must provide a medical certificate. In the event of adoption, the same laws for maternity and paternity leave apply. However, instead of seven days’ notice, 14 days’ notice must be given to the employer.
Paternity Leave
Fathers are entitled to two weeks of paid paternity leave.
Parental Leave
Fathers are entitled to 2 weeks paid paternity leave.
Other Leave
Parents who are preparing to adopt a child are eligible for one month of pre-adoptive leave with full pay. Parents must provide 14 days’ notice to their employer and show the relevant adoption papers.
PAID MATERNITY LEAVE (DAYS)
Termination
Termination Process
Employers can terminate employees’ employment for the following reasons –performance, redundancy, and any other substantial reason that may justify dismissal,or worker misconduct. It requires notice and a written explanation for the termination. If the reason is misconduct, a warning needs to be given with the employee given a chance to explain his/her actions.
When the employer initiates the termination of an employment agreement, the employer must pay final wages on the termination date.
| Salary payment interval / date | Final payment on termination | Bank account payment requirement |
|---|---|---|
| Employers must pay wages in legal tender at “regular intervals” as per the contract. They may pay hourly, daily, weekly or monthly depending on the work; the law doesn’t fix a single interval for all workers. | Upon termination, the employer must pay all wages earned and any allowances due. Additionally, for dismissals the employer must, within seven days, deliver a written report of the dismissal to a labour officer. | Wages must be paid in Kenyan currency and may be paid in cash, cheque, or into a bank account designated by the employee (or postal/money order) under the law. |
Notice Period
Notice periods in Kenya are as follows:
- Employees terminated during the probationary period should be given at least seven days’ notice.
- If the employee is being paid daily, notice is not required.
- If the employee is being paid periodically (weekly or bi-weekly), the notice is one week or two weeks, accordingly.
- If the employee is being paid monthly a month’s notice is required.
Severance Pay
Severance pay is payable at the rate of 15 days for every year worked and is only payable in cases where termination is on account of redundancy. In cases of termination for other reasons other than redundancy, service pay is payable at a rate equal to that of severance pay.
Probation Period
The probation period in Kenya is cannot be more than to six months, and can be extended up to an additional 6 months, with the employee’s consent. A probationary contract must be in writing and state it is for a probationary period. If the employer dismisses the employee during this time, seven days’ notice or payment in lieu must be given. A probationary worker’s base salary must be the same as the base salary of the same position.
Immigration
Kenya’s immigration system provides several options for employers of foreign nationals. Most business travelers must apply for an eVisa to enter the country. Port-of-entry immigration officers will determine the authorized length of stay in Kenya, which is usually a maximum of 30 days, extendable twice for 30 days each at the Immigration Department in Kenya for a maximum of 90 days.
The Special Pass allows foreign nationals to conduct work activities for up to 90 days. Special Pass applications are filed at the Kenya Immigration Department Headquarters before the foreign national travels to Kenya.
The long-term work permit (Class D Permit) is suitable for skilled and experienced professionals or technical workers and it requires sponsorship from a Kenyan legal entity. Work permits are issued for one or two years and can be renewed for similar periods.
VAT
General
The standard VAT rate is 16%.
Stay up to date on payroll & employment law changes
Version History
The standard working week should not exceed 56 hours now.
Employers are now required to provide extra pay to employees who work during night hours (between 10 pm and 6 am) if time off in lieu is not provided. The pay amount must be not less than 1.2 times the regular hourly salary.
An employee is entitled to 10 consecutive calendar days of leave at least once out of the minimum 15 calendar days of leave.
Questions & Answers
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Payroll and Benefits Guide
in Kenya
What’s covered in this guide:
- Employer/employee contributions
- Minimum wage
- Working hours
- Visa requirements
And more...
Public Holidays Calendar
| Date | Day | Holiday | Notes |
|---|---|---|---|
| 1 January 2026 | Thursday | New Year’s Day | Standard holiday |
| 20 March 2026 | Friday | Idd-ul-Fitr (End of Ramadan) | Standard holiday |
| 3 April 2026 | Friday | Good Friday | Standard holiday |
| 6 April 2026 | Monday | Easter Monday | Standard holiday |
| 1 May 2026 | Friday | Labour Day | Standard holiday |
| 27 May 2026 | Wednesday | Idd-ul-Adha (Feast of Sacrifice) | Standard holiday |
| 1 June 2026 | Monday | Madaraka Day | Standard holiday |
| 10 October 2026 | Saturday | Utamaduni Day (formerly Moi Day, then Mazingira Day) | Standard holiday |
| 20 October 2026 | Tuesday | Mashujaa Day (Heroes’ Day) | Standard holiday |
| 12 December 2026 | Saturday | Jamhuri Day | Standard holiday |
| 25 December 2026 | Friday | Christmas Day | Standard holiday |
| 26 December 2026 | Saturday | Boxing Day | Standard holiday |
is there a provision in law requiring private sector employers to provide housing benefits/ allowances for its employees?
These can be included in contracts or collective bargaining agreements, but is entirely up to employer and employee to negotiate.
What is the formula to calculate insurance relief in order to SHIF
The monthly contribution rate for SHIF is 2.75% of the gross salary, with a minimum contribution of KES 300 per month and no maximum limit on contributions. There are many online calculators which can be used to help calculate.