What you need to know about NSSF contributions

Formal workers are allowed to voluntarily contribute more than Sh200 but the additional money is not matched by employers. [iStockphoto]

The proposed NSSF contribution that High court quashed

The proposed contributions to increase contributions are contained in the NSSF Act 2013.

High Court said the Act was not subjected to public participation before passage as required in the constitution.

If allowed, the Act would have seen workers compelled to save more for retirement, with employees also matching it.

Total monthly NSSF contribution would have been Sh2,160 (split equally between employee and employer.

The Sh2,160 is 12 per cent of Sh18,000 which was the proposed maximum pensionable earnings.

The stalled Act wanted to stagger payment over a period of five years.

Top earners were to pay more than Sh10,000 monthly with their employers topping an equivalent amount in the fifth year.

In the first year, top earners were to contribute Sh1,080 while low earners contribute Sh360 and employers match this.

The amount was to rise gradually with that of lower earners crossing Sh500 in the fourth year and that of top earners going above Sh10,800.