Employer of Record in Kenya
Skuad's Kenya EOR (Employer of Record) solution enables you to extend your company into Kenya without the requirement to establish an organization. Our unified and automated global human resources platform helps you to streamline remote team onboarding and handle their payroll, benefits, and other HR functions in a compliant manner. With the support of our worldwide network, we assist you in streamlining the worldwide growth process.
Kenya at a Glance
Population: 48.69 millions
Currency: Kenyan shilling
Capital city: Nairobi
Languages spoken: Swahili, English
GDP growth rate: 6.9%
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What You Must Know Before Employing in Kenya
Kenya's employment regulations apply to both foreign nationals and domestic residents. However, their rights are somewhat varied. Let us examine the distinctions and other facets of Kenya's employment laws.
To commence business operations in Kenya, a company must be familiar with all elements of Kenya's employment laws. They may seem to be fairly complicated and perplexing, yet they are not dissimilar to employment legislation in many other nations. Nonetheless, to minimize or reduce the difficulties that may occur for companies establishing a local office, it is prudent to engage with a local payroll provider who is familiar with Kenya's rules governing both local and international personnel.
To ensure your expansion endeavors comply with the Kenya employment laws, Contact Skuad today.
Contractors vs Full-Time Employees
- If a worker is categorized as an employee, he or she is responsible for withholding, depositing, reporting, and paying employment taxes, as well as withholding and reporting Social Security and Medicare taxes.
- When a worker is designated as an independent contractor, then he or she is relieved of some of the administrative burden. Independent contractors are responsible for arranging and paying their income taxes every quarter and are not entitled to any perks.
In Kenya, it is mandatory to have a formal employment contract in the local language that details the employee's remuneration, perks, and termination criteria. In Kenya, an offer letter and job contract must always include the salary and any other remuneration in Kenyan shillings and not in a foreign currency.
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Probation & Termination
Employers or employees can terminate an indefinite-term employment contract by giving the following notice:
- If the employee is paid on a daily basis, no notice period is necessary, and the contract will expire at the end of the day on which the employee is terminated or resigns.
- When the employee receives less than 1 month (for example, weekly or every 2 weeks) payment, the contract will cease at the end of the pay period after the period of pay during which the written notice has been sent.
- If the employee is paid monthly or longer, the contract will cease 28 days after the notice is issued.
- Employment contracts may include provisions for increased notice periods. Additionally, the party canceling the contract may grant compensation in place of notice. When an employee resigns, the employer may dismiss the notice period but must compensate the employee for any earnings received during the notice period.
- Employers and workers are entitled to cancel a contract of employment during the probation period by giving 7 days’ notice or compensation in place of notice. If the company and employee agree, the probation term may be extended to another six months.
- Employers are required to pay any outstanding wages to employees upon termination. Monthly compensated workers may be entitled to severance pay of an amount specified in the employment contract, although certain conditions apply.
- The employer must provide a written report to the employer in the district in which the employee worked, detailing the circumstances and grounds for dismissal, and providing the notice period or wages as compensation in place of notice.
- Employers may fire an employee summarily without providing notice or with less notice than is needed for egregious misbehavior.
EOR Solution in Kenya
The Kenya Employer of Record (Kenya EOR) solution enables enterprises to grow in Kenya more easily and quickly. Using the EOR method guarantees seamless and compliance payroll and other employment obligations processing without forming an organization. Skuad’s unified employment platform can assist you with managing your workers' monthly payroll, contracts, work permits, and taxes in Kenya.
Outsourcing Employment Through An Employer of Record
When a company decides to expand in Kenya, it must also decide on the path to pursue. Whether you want to develop an in-house team or hire an EOR to handle payroll and employee lifecycle management.
Types of Visas in Kenya
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Skuad's Kenya-based local partner may sponsor international employees for work visas. Skuad, as an EOR in Kenya, is responsible for all employment-related duties and duties. The client organization may manage their workers' everyday activities and operations using Skuad's HR platform.
- We have assisted businesses in quickly onboarding, payrolling, and terminating workers at the conclusion of their employment agreements as required.
- If you wish to get a work visa for an overseas applicant swiftly and without danger, Skuad's HR team can act as your loyal partner. We will walk you through each stage and advise you on the necessary documentation.
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Things You Must Know To Set Up Payroll In Singapore
You must be aware of the requirements which differ from category to category in order to create payroll and handle taxes in Kenya. First and foremost, if you wish to engage international experts or residents. You must be informed of local tax rules, such as income tax, business tax, withholding tax, insurance for employees, social safety expenses, etc., and you must comply with them. There are two methods to accomplish it:
- You establish staff in Kenya that manages the payroll.
- You engage the services of a local payroll professional, who will simplify management while also ensuring compliance with Kenyan rules.
Payroll & Taxes
Employees are given bonuses amount that’s equivalent to their one month’s salary.
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Incorporation: How to Set Up a Subsidiary in Kenya
Over the years, Kenya has transformed into a favorite business destination for all budding entrepreneurs because of its business friendliness. Setting up a subsidiary in Kenya can be challenging and time-consuming. Hence, an EOR like Skuad enables organizations to build remote teams in Kenya without setting up an entity.
- Obtaining approval on and reserving a company name through the Registrar of Companies
- Preparing and stamping the Memorandum, Articles of Association, and Statement of Nominal Capital
- Signing the Declaration of Compliance
- Completing and filing all relevant forms
- Registering for taxes with the Kenya Revenue Authority (KRA)
- Applying for a business permit
- Registering with social security services
- Creating a company seal
While meeting a country’s law can be a painful process, it does require a huge amount of time, which might affect your business growth and expansion. Instead, Skuad can enable operations in Kenya without having to set up an entity while completely complying with the country's laws.
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PEO and payroll in Kenya
- The days of businesses being unable to grow abroad as fast as desirable are over. This is due to impediments to global commerce such as complex local regulations or the time-consuming and expensive process of establishing a foreign subsidiary. Professional Employer Organizations have created a new and improved method of expanding globally by recruiting foreign labor from other countries.
- Skuad’s payroll solution in Kenya is an excellent method to avoid the burden of establishing a legal business or navigating local labor rules. It enables you to concentrate on critical business duties. By using our foreign employment outsourcing service in Kenya, you can avoid the risks associated with employee misclassification and/or noncompliance.
A Professional Employer Organization functions as the organization's co-employer and is responsible for the organization's entire staff. It shares an organization's human resource obligations and liabilities and may take over the entirety of human resource activities. It employs a minimum of five to ten people. It works for the organization it is associated with, in all countries.
PEO vs EOR
Employment rules and regulations get increasingly complicated and diversified when a business expands across regions.
If a business works with a PEO, it must create a legal presence in each state or nation where it has workers. However, if the corporation's EOR spans many countries, the corporation is legally permitted to hire people in those states through the EOR.
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When expanding into Kenya, partnering with Skuad may significantly decrease the traditional brick and mortar procedures associated with conducting business in international locations, allowing you to concentrate on what you do best: developing your business! To learn more about how we, the Skuad team, can help you streamline your worldwide expansion efforts, please contact us.