The National Social Security Fund (NSSF) bid to increase monthly deductions to Ksh2,160 hit another snag after the directive was challenged at the Supreme Court.
County Pensioners Association on Friday, February 17, filed a petition before the highest court in the land in a bid to have the directive overturned.
The increased deduction was being supported by President William Ruto's administration as they wanted to create a savings culture among Kenyans.
In its petition, the lobby group asked the court to immediately halt NSSF's directive as the new deductions were to be effected with February salaries.
The association explained that workers would be the most affected given that other employers had better pension schemes and would in turn opt for NSSF.
"Workers will suffer substantial and irreparable harm (including but not limited to a run on pension schemes superior to the NSSF) unless this court stops the implementation of the disputed Act pending the hearing and determination of the Applicant’s appeal.
"The ordered functioning of the pensions industry will suffer enormous and irreversible chaos, harm, and damage should the government, trade unions and Federation of Kenya Employers implement the NSSF Act of 2013" read the petition in part.
Additionally, the lobby group told the Supreme Court that the Court of Appeal which upheld the enforcement of the 2013 Act erred in its ruling and was not considerate to workers.
The Supreme Court is yet to issue a directive on the same.
NSSF's Ksh2,160 deductions were to be effected beginning February 2023 with employees parting with half of the new rate.
"The pension contribution will be 12 per cent of the pensionable wages made up of two equal portions of 6 per cent from the employee and 6 per cent from the employer subject to an upper limit of Ksh2,160 for employees earning above Ksh18,000," NSSF directed then.
Despite resistance from a number of workers' groups, Central Organisation Trade Union (COTU) boss Francis Atwoli supported the new deductions stating that the employees would benefit.
"Many workers have only been contributing to and receiving funds from the provident fund, which is a lump sum payment that workers have been receiving at a go (Tier 1 - provident fund).
"After receiving the lump sum from the provident fund, Kenyan workers have been left exposed to old age poverty with no social security covering them," Atwoli explained.
