Payslips shame as many civil servants take home less than third of salary

People walking Nairobi

People walking along Racecourse Road in Nairobi on May 25, 2020.

Photo credit: Evans Habil | Nation Media Group

Hard economic times marked by increased taxes, statutory and loan deductions have left tens of thousands of workers taking home literally nothing as their payslips are left depleted, which has increased cases of depression among Kenyans.

One in two police and prison officers, and one out of every five civil servants were left with less than a third of their salaries to take home last year, as those seeking psycho-social support doubled to 12,532 since 2019.

In a report revealing the extent of impact of growing payslip deductions particularly on low earners, the Public Service Commission (PSC) in its presentation before the National Dialogue Committee (Nadco), revealed that out of the about 300,000 public officers it manages, 82,577 were taking home below a third of their basic salaries, majority being police and prison officers (65,445) and civil servants (17,132).

“The rising cost of living has continuously impacted negatively on public officers which has resulted in low morale, poor performance and poor social welfare of officers some of whom are undergoing depression for, amongst other reasons, the inability to meet their financial obligations as and when they fall due,” PSC chairman Anthony Muchiri told Nadco in October.

The PSC chair noted that, following increased salary deductions, a growing number of public officers ended up earning net salaries of less than a third of their basic pay since they were already servicing loans, “thereby causing pecuniary embarrassment to the officers.”

The Auditor-General’s latest report on county governments also shows that some 8,444 workers in 28 counties took home below a third of their salaries in the year ending June, 2023, with worst scenarios witnessed in Kitui County where a number of workers had to take home less than Sh100 after a month’s work.

“Review of IPPD (Integrated Personnel and Payroll Database) payroll data revealed that 97 employees were receiving net salaries that were less than a third of their basic pay, with some getting net salaries of below Kshs.100,” Auditor-General Nancy Gathungu said on Kitui County.

With growing cases of workers unable to meet daily expenses due to huge deductions and mental issues being reported, different players within the labour sector have now come out to call for a solution, warning that the deductions could trigger a massive exit of workers from formal employment. The law prohibits employers from deducting more than two-thirds from workers’ salaries.

“Without prejudice to any right of recovery of any debt due, and notwithstanding the provisions of any other written law, the total amount of all deductions which may be made by an employer from the wages of his employee at any one time shall not exceed two-thirds of such wages or such additional or other amount as may be prescribed by the Minister either generally or in relation to a specified employer or employee or class of employers or employees or any trade or industry,” the Labour Act, 2007, states.

The current deductions are as a result of introduction of the 1.5 per cent Housing Levy, the staggered increase of the NSSF contributions that started last year and increased Pay As You Earn (PAYE) for high earners.

The situation will only get worse when the new 2.75 per cent Social Health Insurance Fund (SHIF) takes effect and as the NSSF deductions catch up with different categories of earners, who will eventually surrender six per cent of their salaries.

The Salaries and Remuneration Commission (SRC) notes that majority of low earners in government are civil servants who take home far below the average recommended salaries, with high earners including doctors and workers in State corporations and constitutional commissions.

Unionists and the PSC say the additional deductions to workers’ salaries have continued to cut their disposable incomes and quality of life, noting that a growing number of workers in public and private sectors are coming out to complain of financial challenges.

“Despite regulations that teachers must retain a third of their basic salary, high cost of living force teachers to go for front office Sacco services like advance loans and salaries.

The result is pecuniary embarrassment to the teacher who cannot make ends meet coz of over-commitment of salary,” says Mr Zablon Awange, Kenya Union of Post-Primary Education Teachers (Kuppet), Kisumu Executive Secretary.

“Any slight deduction is a nightmare. With an employer who is rigid the union must work extra hard to cushion such members,” he adds.

Mr Benson Okwaro, Central Organisation of Trade Unions (Cotu) deputy Secretary-General and General Secretary of the Communication Workers Union, notes that while trade unionists’ main objective is to bargain for better take-home for workers, there are growing cases of workers whose pay has fallen below legally allowable limits and says unions are planning to take on employers.

“I am aware that there are cases where we have reached that stage now and this has been occasioned by recent taxes that have been levied against the Kenyan workers since last year.

It’s a very worrying situations and we have to start addressing it very urgently,” Mr Okwaro says.

Mr Okwaro notes that many employers were left without an option other than deduct employees huge chunks of their salaries when new taxes and levies were introduced, for fear of rubbing the government the wrong way.

The unionist notes within the communications sector workforce in the public service- whom he representsmajority earn basic salaries of below Sh50,000 and usually end up with net salaries of less than Sh30,000 due to the deductions.

“If you are taking home Sh25,000 and you have got to commute to work, pay rent, pay school fees and settle other household expenses, it’s simply not practical. People are living in abject poverty. It’s terrible.

Very soon, people will be walking in the streets mad because they can’t manage,” he says.

Mr Okwaro notes that the problem is not only being experienced in the public sector, but also the private sector, where workers who had existing payslip commitments have been left with almost nothing to take home.