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SALARY PAYMENT IN Kenyan Shilling
CONTRACT LANGUAGE English
PAYROLL TAX 6.5%
PAYROLL CYCLE Monthly
TIME TO HIRE 24 hours
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Kenya is an East African country with a young and educated English-speaking population. While the bulk of the Kenyan economy has traditionally focused on agriculture, Kenya also has a developed and growing tech startup ecosystem which points toward increasing tech literacy among workers there.
Data from 2021 suggests a 3.32% growth of the labor market; at the same time, the employment rate remains relatively stagnant. This data suggests there may be an opportunity for international employers who want to hire in Kenya.
As the hub of East African business, Kenya is a top choice for employers looking to expand to the region. Opening a subsidiary can be costly and risky, however, due to the need to consistently staff an HR, legal, and accounting team locally. Outsourcing the back office to a trusted partner (such as the Horizons Kenya EOR) is the most affordable path to compliant hiring in Kenya.
The Horizons EOR solution means international companies can hire in Kenya — without the need for an expensive local subsidiary.
Horizons enables your company to hire and onboard your team in as little as 24 hours.
Experts in Kenya labor and tax laws ensure you are fully compliant with all applicable laws.
Horizons ensures accurate salary and payroll processing, based on your chosen pay period. The Horizons EOR platform makes income tax withholding and expense management straightforward.
Guarantee that all employees in Kenya are welcomed onboard with a compliant contract and all necessary formalities.
Horizons ensures that employment remains compliant and deals with any legal and compliance issues as they arise.
With a Kenya EOR, you save up to 85 percent of the total cost of hiring in Kenya.
Hire borderless talent with Horizons
A Kenya Employer of Record, or Kenya EOR, is an HR outsourcing company that hires employees on behalf of client-companies as the legal employer. While a Kenya EOR handles all admin related to the actual hiring of employees, the employee’s day-to-day activities are 100% handled by you, the client company.
Horizons Kenya EOR provides companies from around the world with a cost-effective, reliable way to hire employees in Kenya that is fully compliant with Kenyan and international employment laws.
Working with a Kenya EOR solves many problems faced by companies that seek to hire and retain high quality talent but don’t want to spend their time managing administrative issues.
Kenyans tend to favor jobs from foreign employers over local ones, and this means you can offer higher salaries and better benefit packages without a significant rise in costs.
By using an EOR, your company is able to focus on its core objectives rather than getting bogged down with payroll processing, HR management, and employee tax compliance issues.
The main benefits of using a Kenya EOR are:
When you hire through Horizons Kenya EOR, Horizons will act as the legal employer for your employees in Kenya. This means that all administrative and HR duties for your Kenya employees will be the legal responsibility of Horizons.
Horizons employees a streamlined hiring process that has been proven to be smooth and efficient. The process of hiring an employee with Horizons’ Kenya EOR is:
Step 1: Engagement
When you contact Horizons, we will reach out to get to assess your case and provide a detailed cost breakdown for your hiring project. If you require any add-on services (like recruitment, visa support, or supplementary insurance), we will go over all the details at this step.
Step 2: Employment facilitation
Horizons’ legal department drafts the employment contract for you and the employee to sign, usually digitally. Sometimes, the contract may be available for signature directly on the Horizons platform or Horizons App. Horizons’ internal legal department are experts in local Kenya law and provide contracts that protect employers and guarantee local labor law compliance.
Step 3: Administrative onboarding
All key declarations are made to Kenyan regulatory bodies, including tax registration. Depending on the employee’s nationality and benefits offered (e.g. insurances), this might include work permits and visas.
Step 4: Monthly payroll processing
Horizons calculates all payroll items and ensure all taxes and contributions are accurate and paid on time. You are invoiced for the costs of the employee plus the EOR fee each month, with itemized invoices. Everything at this stage is transparent for both employees and employers.
Step 5: Ongoing HR & administrative support
At each step, for all parties involved, Horizons acts as the HR and employment law expert for Kenya. We can answer any questions that may come up during the course of your hiring project.
Step 6: Further expansion
Later, when you are ready to grow your Kenya team, expand to other countries in Africa, or hire in a new region, we are ready. Horizons supports 180+ countries globally. In many cases you can raise the hiring request and provide employee information directly online, receiving the employment contract draft in your new country of hire in minutes.
Step 7: Offboarding
When your employee is ready to move on, we will guide you through all of the country-specific offboarding formalities for Kenya. Horizons has a high success rate for smooth transition for the former employee, and for the hiring of the new employee.
Maternity and paternity leave
New mothers in Kenya are entitled to a minimum 3 months’ paid maternity leave, while fathers in Kenya are entitled to a minimum 2 weeks’ paternity leave.
Healthcare
According to Kenyan labor code, employers in Kenya must provide medical treatment to employees during time of service. This means that employers should provide adequate health insurance to their Kenya employees. The National Hospital Insurance Fund (NHIF) is the largest health insurance provider in Kenya, and packages from the NHIF include comprehensive medical coverage for all diseases.
If you want to purchase supplemental global insurance for your employees, Horizons offers this at an additional cost.
Pensions
Kenya’s National Social Security Fund (NSSF) is the body that regulates the occupational (job-related) pension scheme in Kenya. Employers have an obligation to pay into the NSSF at a rate of 6.0% of employee salary per month (to a maximum 200 KSH per month).
Employer taxes
Employer or payroll taxes represent 6.0% of an employee’s monthly salary + 50 KSH for the National Industrial Training Levy (NITA).
The NITA is a state corporation created to promote the best standards for industrial quality, efficiency, and safety. Trainings attended by employees (both internal and external) which are accredited by NITA are eligible for a refund from NITA upon application by the employer.
Another additional contribution of 1.50% may be added in 2023, but is currently stuck in judicial review. If ruled favourable, this contribution would support the National Housing Development Fund. Currently this contribution is not collected by employers in Kenya.
Income tax
Kenya has a progressive income tax system with the following rates for individual employee income tax:
Horizons has a young, tech-savvy, entrepreneurial, and English-speaking workforce. It is a talent pool suitable for international companies looking to expand to the African continent.
With Horizons as your trusted EOR partner, you can avoid opening a costly subsidiary and hire in Kenya within 24 hours. Get in touch today to get started.
A Kenya Employer of Record (EOR) solution involves a specialist HR company hiring local employees on behalf of a third-party (usually international) company. The Kenya EOR takes care of payroll, HR and employment compliance.
A Kenya Professional Employer Organization (PEO) usually provides an EOR solution, but may also provides additional HR solutions such as recruitment, global mobility support and contractor management.
A Kenya EOR is useful for any company that seeks to hire employees in Kenya, but doesn’t need an incorporated local entity or subsidiary in the country. It is a faster and more cost-effective solution for those companies.
