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Employer of Record (EOR) in Kenya

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%

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.
Entitlements Explanations
Statutory Working Hour
  • The usual workweek varies by company but is typically between 40 and 52 hours over six days. Night shift employees might work up to 60 hours each week. The night shift is from 6:30 p.m. to 6:30 a.m. Employees 16 years of age or younger are permitted to work up to 36 hours per week.
  • After six days of labor, employees enjoy one day of relaxation. Those who labor on a rest day are compensated at a rate of 200 percent of the baseline rate.
  • Employees who labor on statutory holidays are eligible to receive 200 percent of their regular pay.
Overtime Eligibility Overtime hours combined with regular daytime hours cannot exceed 116 hours in a two-week period. Overtime hours combined with nighttime work cannot exceed 144 hours in a two-week period. On weekdays, overtime is paid at 150 percent of the base rate; on Sundays and public holidays, overtime is paid at 200 percent of the basic rate.
Paid Public Holiday
  • New Year’s Day
  • Good Friday
  • Easter Monday
  • Labour Day
  • Idd ul-Fitr
  • Madaraka Day
  • Idd ul-Azha
  • Moi Day
  • Diwali
  • Kenyatta Day
  • Christmas Day
  • Independence Day
  • Boxing Day
Holiday Pay Employees are eligible for public holiday compensation if they:
  • Are on an approved vacation, such as a yearly vacation, etc.,
  • Apply for medical leave,
  • Before and after a holiday
Vacation Leave Employees are entitled to 21 days of paid leave each year after completion of 1 year of service.
Sick Leave After two consecutive months of employment, employees are entitled to 14 days of paid sick leave every year. Employees are required to provide a medical certificate. When the employee has at least two months of service, the first seven days are completely compensated. The remaining days are compensated at 50%.
Maternity / Paternity Leave Female workers are entitled to three months of paid maternity leave with seven days notice. Employers have the option of extending maternity leave. Male employees are entitled to two weeks of paid paternity leave.

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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.

Employment Contracts

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.

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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

Visa Category Description
Class A Issued to those who want to participate in mineral exploration or mining.

Minimum requirements:

  • It is vital to get or be guaranteed to obtain the required permits and registrations.
  • Renewals need a valid prospecting mineral license and a copy of the PIN.
  • An adequate amount of money or resources for investing
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Class B Individuals desiring to invest in Agriculture and Animal Husbandry

Minimum requirements:

  • Evidence of land ownership or a leasehold interest in land that is being used for this purpose.
  • Evidence of accessible capital for the goal.
  • Approval by appropriate authorities.
  • Renewals need a valid prospecting mineral license and a copy of the PIN.
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Class D Issued to an individual who has been offered a particular job by a particular business and is qualified to accept it.

Minimum requirements:

  • Documents of academic/professional certifications, as well as a curriculum vitae.
  • Proof that the organization was unable to fill the position via the local labor market.
  • A fully completed, signed to obtain, and sealed Form 25 by the firm.
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Class G Investors in specified trades, businesses, or consulting are granted work permits.

Minimum requirements:

  • Documented verification of a minimum investment of $100,000 US dollars or its equivalent or any other currency
  • A company's registration certificate OR a certificate of incorporation.
  • Copies of both your personal and business PIN, if your firm is operational.
  • For renewals, audited financial statements for the preceding two years and a tax compliance certificate from the Kenya Revenue Authority.
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Class I Permit to work/reside in Kenya provided to a member of a missionary organization that has been sanctioned by the Kenyan government and whose presence benefits the nation.

Minimum requirements:

  • A copy of the organization's registration certificate.
  • The applicant's academic and professional credentials.
Please talk to us to learn more
Class K A residence permit is provided to those who have an established source of income from outside sources and agree not to accept any kind of paid job.

Minimum requirements:

  • For Class K, documented evidence of guaranteed income is necessary.
  • Please talk to us to learn more
    Class M
  • Conventional Refugees are granted work permits.
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    Work Permit

    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.
    The estimated time frame for granting of a work permit Typically, the process of obtaining a work permit in Kenya takes between four and eight months from the time of admission to Kenya, plus an additional one to two months to finish the process.
    Steps to get the work permit
    • Entry Permit Class D Application
    • E-Visa Application
    • Entry to Kenya
    • Re-Entry Pass Application
    Documents for the work permit Passport page with a validity of two years
    Proof of qualifications Documentation establishing the applicant's eligibility for the position - a copy of the applicant's diploma/degree/professional qualification. Copies should be verified by a Kenyan lawyer.
    Passport Photographs 2 passport-sized images (35mm x 45mm), in color. Photos must be recently shot and must:
    • display a close-shot of the applicant’s face and the top of his/her shoulders
    • show the person gazing properly at the camera
    • Headcovers are not allowed unless for religious reasons; all facial characteristics must be clearly shown in such circumstances
    • Spectacles can be used; however, the individual's eyes should be readily visible and no shades should be used
    • Photographs should be of good quality and shall not be degraded or defecated in any manner, without writing traces, lines or plumes.
    Fees The payment of 10,000 KSH must be made in the form of a banker's check, not reimbursable and shall cover the costs of the examination of the application
    CV Show relevant professional and educational experiences
    Flight Booking -
    E-Visa form Fill the form online, and print out 2 copies, the sponsoring body will then sign and stamp
    Digital Photo A maximum of 500px x 500px digital passport photograph
    E Visa Payment Online $51 paid with credit or debit card Visa or MasterCard
    Passport Information Copy Page Scanned copy or photo
    Passport Validation Passport is valid for 2 years
    Registration Fee KES 2000 per individual
    Foreign Registration Application Form Fill the form online, print it out and sign

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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

    Employer taxation

    Employer Taxation

    Tax Explanation
    Income Tax Rates
    • Individuals who are residents are charged internationally on their job incomes, whether they are Kenya tax residents throughout their period of work or if they are non-residents, if their employer is a resident or has a permanent presence in Kenya.
    • Kenyan citizens for tax purposes should be deemed individuals if he/she/she:
    • Is present in Kenya for a period of 183 days or more or for an average period of 122 days and over the same year or in the previous two years
    • Has a constant residence in Kenya
    • Persons from the following groups are liable to Kenyan personal income tax:

    • Business and self-employment revenues
    • Employment revenue
    • In Kenya, income from capital gains on property transfers
    Social security
    • Each employer contributes 5% of social security payments. The tariff was hiked to 6%

    Employee Taxation

    Tax Explanation
    Income Tax
    Income Tax Rates
    1 - 288,000 10
    288,001 - 488,000 15
    688,001 and above 25
    Tax Returns Yes
    Social security and legal contributions for employees
  • Each employee contributes 5% of social security payments. The tariff was hiked to 6%
  • Also, must additionally pay a proportion of pay depending on the income of the employee to the National Hospital Insurance Fund.
  • Bonuses

    Employees are given bonuses amount that’s equivalent to their one month’s salary.

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    Human Resources Compliance in Kenya

    Skuad's professional expertise, talents, and experience will be your advantage. We provide the option of anticipating hazards and give you a roadmap for day-to-day operations.

    Our Human Resources Compliance service in Kenya will assist you in the following ways:

    • We explore Kenya's regulations and cultural subtleties. You must understand what constitutes appropriate behavior and what constitutes risk of an employment lawsuit.
    • Avoid high-risk situations. Certain sectors and activities, such as employer-employee interactions, might introduce unneeded hazards. We can assist you with classifying employees, calculating payroll and taxes, and calculating social cost contributions.
    • In Kenya, you will be responsible for currency exchanges and local invoicing. We save you time and effort by relieving you of the burden of deciphering complex rules and tax computations written in a foreign language.
    • Our goal is to help you with international human resource compliance challenges and to provide you with the most advantageous payment and tax choices in Kenya.
    • Manage the complexities of expatriate immigration and visa assistance in Kenya.

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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.

    PEO

    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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    Conclusion

    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.

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