Salaried Kenyans are set to face more deductions from their monthly earnings after Ikolomani
Member of Parliament Benard Shinali sponsored a bill “Unemployment Insurance Fund” that was
tabled in the parliamentary budget office on Thursday, which will force employers and employees to fund the kitty.
According to the sponsor of the bill, he got inspiration from South Africa where their employers and employees are both deducted 1%.
“The objective of the proposal is to provide for the payment of unemployment benefits to
employees who become unemployed or their beneficiaries by proposing to establish the
Unemployment Insurance Fund to which both the employer and employee will contribute,” the bill
reads in part.
Shinali noted it will help out-of-work employees in navigating difficult socio-economic
circumstances. In addition to salary deductions, the fund will be supplemented through
parliamentary appropriations from the national government, county government funding, and
donations and grants from development partners.
According to the Bill, the money would be held by the Unemployment Insurance Authority, which
will be constituted through a parliamentary act.
The Authority will take the shape of a body
corporate with specified rules and laws, as well as a board of nine members and a chairperson.
“The functions of the Authority will include; administering the Fund, advising the Cabinet Secretary on unemployment insurance policies and legislation, advising both levels of government on policy matters on unemployment and unemployment insurance while also facilitating the implementation of such policies relating to unemployment insurance,” the bill reads in part.
If the bill is passed by parliament, the Treasury Cabinet Secretary will have the authority to exclude some employees from the statutory salary deduction.
Also Read: Supreme Court Issues Ruling on Implementation of Finance Act 2023
