Pay Slips Under Siege: FKE Sounds the Alarm
Picture this. You’ve worked tirelessly all month. The paycheck hits your account, but it’s… a whisper. A shadow of its former self.
This is the reality for many salaried Kenyans today, and the Federation of Kenyan Employers (FKE) isn’t holding back. They’re warning of a looming crisis—a raid on pay slips that’s pushing workers to the brink.
The Pay Slip Squeeze
Jacqueline Mugo, FKE’s CEO, laid it out starkly.
“In our calculation, about 45-50% of employees’ salaries are going to taxes and deductions,” she said. “How do people survive on this? At some point, they’ll ask, ‘What’s the value of being employed?’”
Since 2022, new taxes and deductions have hit hard. Employers are struggling to comply. Some are even over-deducting—illegally.
For many workers, take-home pay has now dipped below the recommended one-third. And as Mugo put it, “If we keep raiding the pay slip, what’s left? People will borrow, they’ll despair… and eventually, there’ll be unrest.”
Jobs on the Line
The numbers are grim.
- 6,000 jobs lost since 2022.
- 57 companies declared redundancies in 2024 alone.
- Pending bills? Over Ksh1 trillion.
Companies are trimming workforces to stay afloat. Both county and national governments have failed to meet their financial obligations, forcing businesses to make tough cuts.
“Pending bills must be paid,” Mugo urged. “This money is owed to people and businesses. It’s not just numbers; it’s livelihoods.”
A Glimmer of Hope?
Amid the turmoil, FKE is cautiously optimistic about 2025. But it’ll take serious reforms.
They’re urging the government to:
- Enhance fiscal responsibility.
- Reform tax policies.
- Bring the informal sector into the fold.
- Strengthen labor laws.
The message is clear: stop targeting pay slips. Kenyans can’t handle more deductions. Businesses can’t either.
The Bigger Picture
For now, the writing’s on the wall. Unhappy workers. Struggling businesses. A tax system that feels more like a chokehold than a lifeline.
As FKE warns, Kenya’s stability hangs in the balance. Will the government listen? Or will the pay slip raid push the nation into deeper waters?
Time, as always, will tell.