Civil servants will face drastic salary cuts from April next year after the Salaries and Compensation Commission reduced the allowances from 247 to five.
Employees in public institutions will only receive house allowances from April 30, 2022 earn, commuter, job-related, task-related and labor market-related allowances.
Nevertheless, the salary authority regularly reviews the additional benefits, taking into account their affordability and tax viability.
SRC chairman Lyn Mengich ordered that all government agencies divide all allowances they are currently paying into five broad categories.
Companies are expected to submit the list to the Commission for review and advice by November 30th if this fails and the allowances are illegal .
The Commission is also dealing with the payment of allowances in absolute terms and not in percentages. She says that percentages are responsible for the country’s ever-increasing labor costs.
“SRC determines, reviews and advises on the allowances, which represent the five categories, the purpose, the eligibility criteria, the criteria, describe the rate and scope, “said Mengich.
The agency’s data show that wage costs in the 2019-20 fiscal year increased to Sh 827 billion from Sh32 billion in the previous year.
The country’s wage bill was 49.5 percent that year, while the ordinary income wage for the same period was 51.7 percent.
The payroll is Sh 558 billion. in the year 2014-15 to Shill 615 billion, Shill 664 billion, Shill 733 billion may not be used for the calculation of pensions or gratuities.
The Commission has determined that the proportion of allowances on gross wages is between 43 and 259 percent, resulting in a lower base or gross public service wage.
Mengich also complained that similar allowances are paid as a percentage of the base salary while others are paid in absolute amounts, which leads to wage distortions.
In this context, the guideline is changed so that the ratio of the base salary to the gross salary is at least 60 percent – to be implemented gradually.
“The allowances are in absolute amounts and not paid as a percentage of base or gross salary unless specifically recommended by the SRC, “said the commission.
Mengich said they would issue a recommendation to convert the allowances currently considered Percent At the same time, the basic salary should be paid in absolute amounts, “while ensuring uniformity in the civil service”.
All the Commission also notes that the allowances in force today would continue to be paid until the final consultation is given after the review would.
“The allowances currently received will continue to be paid until the SRK issues advice to public service institutions about the certificates,” said the commissioner.
She said that im July 2022 compliance reviews would be conducted to improve compliance. After that, employees of non-compliant companies would lose salaries.
In the strict new rules, relief will be granted Civil servants for work outside of their place of employment would consistently be paid at the same rate.
Um To avoid duplication, allowances that are paid for similar purposes but have different names are merged and renamed.
“Allowances whose reason for payment is still valid, but whose rates do not correspond to the intended use, are to be restructured “Added the SRC boss.
Allowances, the current form of which remains relevant, while those for which the reason for payment is redundant or overlaps with the base salary will be abolished.
“The reviews would take into account existing collective agreements, any contractual obligations and existing legislation,” said Mengich.
The Sala Die ries Commission would determine w el which allowances are to be maintained, restructured, merged, renamed and abolished.
In the area of pensions, the Commission would develop a directive setting pensionable salaries and employer contributions in the public sector.
Civil servants also do not receive any allowances for purposes that are already remunerated by the relative value of an employment or whose purpose overlaps with the basic salary regulation.
“Allowances are not paid purposes that are already paid in the basic salary”, said SRC and urged government agencies to tighten allowances that have already been paid.
(Edited by Bilha Makokha)