The Salaries and Remuneration Commission (SRC) has settled on the final draft of laws that will govern payment of allowances of civil servants as it seeks ways to tame the ballooning wage bill.
The draft regulations unveiled by the SRC on Tuesday, March 16 state that the allowances should not be more than 40 per cent of the monthly gross pay.
"Absence of a policy to guide management and administration of allowances and benefits in the public sector has led to a proliferation of allowances, distortions in remuneration, unfairness in pay, lack of transparency, accountability and inequity," SRC explained the rationale behind the changes.
However, the new allowances cap will only apply to new employees joining the public service. This move has saved thousands of civil servants a major pay cut that would have resulted in the scrapping of several allowances in their gross salaries.
“Allowances and benefits that are abolished will cease to apply to any new employee in the organisation or new to the grade,” the SRC said through the draft policy unveiled for public participation.
Also exempted from the new proposal are facilitative allowances which are paid to meet expenses incurred by officials in the course of duty such as daily subsistence allowance or per diem.
Some of the allowances are paid as a percentage of basic salary but the proposal dictates that they shall be paid in absolute amounts and not as a percentage of the basic or gross salary.
SRC has also proposed to abolish the following allowances;
Retreat Allowance and related allowances - It is an allowance paid to public officers participating in special assignments meant to review, develop and produce policy documents away from their work station
Responsibility Allowance - It is an allowance paid to an officer whose duties involve added responsibility significantly over and above the duties stipulated in one’s job description as evaluated by SRC for which a regular salary is assigned.
Utility Allowance and related allowances - It is an allowance paid to the Accounting/Authorized Officers and senior management of State Corporations and Public Universities to cater for water, electricity and security bills.
Medical Allowance and related Allowances - The allowances are paid alongside monthly salary based on the job group to cater for outpatient medical treatment.
Security Allowance paid in lieu of the provision of security as a benefit - it is paid to specified senior management employees to facilitate provision of security at the areas of residence of a senior public official to meet the cost of security when official security is not provided.
Owner Occupier House Allowance - It is an allowance paid to officers who lived in their own houses to cater for house allowance.
New allowances shall be categorized into five (5) clusters, namely:
(a) House Allowance: This is an allowance provided to Public Officers to cater for accommodation or rent expenses in addition to the wages or salary of the employee pursuant to the Employment Act 2007 Section 31 (1). However, as per Section 31 (2), this does not apply to an employee whose contract of service:
(i) contains a provision that consolidates as part of the basic wage or salary of the employee, an element intended to be used by the employee as rent or which is otherwise intended to enable the employee to provide himself with housing accommodation; or
(ii) is the subject matter of or is otherwise covered by a collective bargaining agreement which provides consolidation of wages as provided in (a).
(b) Commuter Allowance: This is an allowance paid to public officers not provided with official transport, to cater for their transportation expenses to and from their place of work.
(c) Job Related Allowances: Job-related allowances and benefits are also known as ‘salary enhancement’. They account for the greatest proportion of allowances in the Kenyan public service and are paid because of a perception that a job is not rewarded appropriately by the salary system. This category of allowances may fall off once a job is correctly evaluated and graded.
(d) Task Related Allowances: These allowances are paid for a temporary period to public officers and shall therefore be paid only to employees appointed to carry out assignments outside the scope of their responsibilities and is over and above what is expected of the officers in their work plan.
(e) Labour Market Adjustment Allowances: These allowances provide correction to certain labour market trends and conditions so as to attract and retain scarce, distinct and specialized requisite skills in specific public sector institutions.
