Kenya Salaried Workers to Face Higher NSSF Deductions from February 2026 as Pension Reforms Take Effect

Salaried workers in Kenya will see higher National Social Security Fund (NSSF) deductions starting February 2026. The government is rolling out the fourth phase of reforms under the NSSF Act, 2013. While the reforms aim to boost retirement savings, many employees will take home less pay.

Under the new rules, both employees and employers will contribute more to the pension fund. The headline contribution rate of 6 percent remains the same, but the base on which it is calculated has expanded. This means higher monthly deductions for most workers, especially those earning middle to high incomes.

Employees earning above KSh100,000 per month will have their maximum NSSF deductions rise to about KSh6,480, up from KSh4,320. Workers earning less but above lower bands will see deductions of around KSh6,000. Lower-income earners will be less affected, remaining on smaller contribution tiers.

Employers will also feel the impact. They are required to match employee contributions. The increased costs may prompt businesses to review budgets, payroll, and hiring strategies.

Officials say the phased reforms are designed to strengthen pension coverage and secure long-term retirement savings. By gradually raising contributions, the government aims to grow the pension pool and enhance financial security for retirees.

While the move benefits long-term savings, it comes as households face tight budgets. Workers are advised to review their finances and plan for reduced take-home pay. Experts note that higher contributions now could provide larger retirement funds later.

The reforms reflect the government’s commitment to improving the social security system. Employees and employers are encouraged to familiarize themselves with the new contribution bands and adjust their planning accordingly.

Kenya’s NSSF changes highlight the balance between immediate pay reductions and long-term retirement security. The government emphasizes that careful implementation and awareness will help workers manage the transition.