FKE asks members to suspend housing levy deductions

The Federation of Kenya Employers (FKE) has instructed its members to halt the deduction of the housing levy following a court order. This directive will remain in effect until the Court of Appeal hears and decides on the appeal against the High Court’s ruling that declared the levy unconstitutional. In a notice issued by FKE’s executive director and CEO, Jacqueline Mugo, the organization emphasized compliance with the court’s decision and assured members they would be kept informed about any developments. Mugo encouraged members with concerns about the implementation of this advisory to contact her office.

The Court of Appeal recently declined to suspend the High Court’s order barring the government from collecting the housing levy. The appellate judges, Lydia Achode, John Mativo, and Gatembu Kairu, stated that public interest favored waiting for the appeal’s determination to avoid irreversible decisions if the High Court’s ruling is upheld. The government, represented by the Attorney General and the National Treasury, had argued that the suspension of the levy would lead to significant budgetary issues and confusion.

President William Ruto has committed to challenging the decision, underscoring the housing program as crucial for creating employment for young Kenyans. The government had been deducting 1.5% from employees’ salaries, matched by employers, to fund the housing initiative.