Pay, Minimum Wage, Deductions in Kenya
What does the law say about pay and minimum wage?
Under the Employment Act, Section 4, wages should be paid in Kenyan currency to the employee or to an authorised person. The wages may be paid in kind but this must not be in the form of alcohol or drugs. Also, section 6 of the Act requires that wages be paid in full, except authorised deductions, permitted by the law.
The Minimum Wage is dealt with by the Regulations of Wages and Conditions of Employment Act and in the Regulation of Wages Order subsidiary to Chapter 229. A tradition has been established according to which the Minister of Labour, in exercise of his or her powers conferred to by Section 11 of the Regulation of Wages and Conditions of Employment Act, orders the increment of minimum wages to come into effect May 1st of every year. In this order he or she follows the recommendations of two tripartite bodies, the General Wages Council, and Agricultural Wages Council (Regulation of Wages and Conditions of Employment Act, section 11).
What is said in collective agreements about pay and minimum wage?
The Trade Disputes Act defines collective agreement as “an agreement made between a trade union and an employer or organisation of employers which relates to terms and conditions of employment, whether or not enforceable in law and whether or not concluded under machinery for negotiation.”
Mostly unionised employees’ wages are fixed by collective agreement, and sometimes in some bigger companies even company agreements exist.
Section 14 (10) of the Trade Disputes Act allows the Minister of Finance to set guidelines or other directives relating to wage and salary levels. A collective agreement that does not comply with these guidelines cannot be registered by the Industrial Court.
Is my employer permitted to deduct some money from my salary without my consent?
No, your employer cannot make a deduction without your consent. Normally an employer must give a written statement to an employee at or before the time at which any payment of wages or salary is made to the employee, in which statutory deductions are included.
What are some of the permitted deductions?
The permitted deductions include the following (Employment Act, section 19):
- The workers’ contributions to any provident, pension, or other fund or scheme approved by the Commissioner for Labour and agreed to by the worker
- Any amount wrongfully paid to an employee, as remuneration, in excess of what the worker is legitimately entitled to, from the employer
- On the written authority of the worker, and for the time being in force, collective agreement, wage determination, court order or arbitration award
- Reasonable amount for any damage done to, or loss of, any property lawfully in the possession or custody of the employer occasioned by the wilful default of the employee
- A day’s wages in respect of each working day for the whole of which the employee, without leave or other lawful cause, absents himself from the premises of the employer or other place proper and appointed for the performance of his work
- An amount of any shortage of money arising through the negligence or dishonesty of the employee whose contract of service provides specifically or his being entrusted with the receipt, custody and payment of money
- Any amount in which the employer has no direct or indirect beneficial interest, and which the employee has requested the employer in writing to deduct from his wages
- An amount due and payable by the employee under and in accordance with the terms of an agreement in writing, by way of repayment or part repayment of a loan of money made to him/her by the employer, not exceeding fifty per cent of the wages payable to that employee after the deduction of all such other amounts as may be due from him/her under this section
- Such other amounts as the Minister may prescribe. For example: benefits in kind (such as housing, car, school fees among others) from employment income are taxable where their aggregate value exceeds KES 36,000 per annum (Income Tax Act, section 5(2)(b)).
Can I make a complaint when there are unlawful deductions from my salary?
Yes. As a worker you may file a complaint to the Labour Officer if you are aggrieved by any deductions by the employer not later than three years after the allegedly unlawful deduction has been made.