MPs Urge Review of Salary Deduction Cap Amid Rising Statutory Deductions
Members of Parliament are now calling on the Attorney General to either scrap or review the law that limits salary deductions to 70 percent of civil servants’ pay. This push comes in response to increased statutory deductions that have significantly reduced government employees’ take-home pay.
The Employment Act currently prohibits employers from deducting more than two-thirds of an employee’s basic salary. However, due to the implementation of new levies and revised rates under President William Ruto’s administration—such as the Affordable Housing Levy (1.5% of gross pay), Social Health Insurance Fund (2.75%), and enhanced NSSF contributions—many civil servants are now left with less than 30 percent of their gross earnings.
Instead of proposing a reduction in deductions, the National Assembly’s Public Accounts Committee (PAC) is advocating for a review or repeal of the law that criminalizes deductions exceeding one-third of an employee’s salary. The committee argues the current law has become impractical under the prevailing tax regime.
PAC Chairperson and Butere MP Tindi Mwale expressed concern over the growing number of government departments breaching this regulation, which was initially designed to safeguard workers’ financial well-being.
“The law is no longer practical due to multiple tax deductions that have eroded workers’ earnings,” Mwale said, referring to Section 19 of the Employment Act, 2007.
The committee plans to summon the National Treasury to explain why thousands of civil servants are receiving less than one-third of their gross salaries, with some having allocated more than the legal limit to loans and statutory deductions.
During a session with Correctional Services Principal Secretary Salome Beacco, the issue was highlighted as a growing concern. Lugari MP Nabii Nabwera warned that if the matter remains unresolved, it will continue to emerge in audit reports.
“This committee has asked the National Treasury—given the implementation of the NSSF Act, SHIF, and the housing levy—to engage the Attorney General for a way forward. If not addressed, this matter will remain an audit concern,” Nabwera noted.
Funyula MP Wilberforce Oundo echoed the concern, stating that civil servants should not be penalized for circumstances beyond their control.
“We need a definitive ruling on this issue. Given the current deductions, the one-third rule is clearly untenable,” Oundo added.
