The National Social Security Fund (NSSF) Act No. 45 of 2013 now moves into Year 4 of its phased implementation in February 2026.
This is going to be the last time in a four-year plan that has gradually raised pension contribution limits based on the Lower Earnings Limit (LEL) and Upper Earnings Limit (UEL).
This process began in February 2023.
From 2027 onwards, however, any further changes to these limits will no longer follow the phased schedule.
Instead, they will be made through Gazette Notices issued by the Cabinet Secretary for Labour and Social Protection.
What Changes in February 2026
Starting February 1, 2026, both employers and employees will each contribute 6 percent of an employee’s monthly pensionable earnings to NSSF, calculated within the new limits of Lower Earnings Limit (LEL) amounting to Ksh.9,000 whereas the Upper Earnings Limit (UEL) will see deductions as high as Ksh.108,000.
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The contributions will be applied in two tiers. For the first Ksh.9,000 of monthly earnings (Tier I), the employee will contribute Ksh.540 and the employer will match this with Ksh.540, bringing the Tier I total to Ksh.1,080.
For earnings above Ksh.9,000 up to Ksh.108,000 (Tier II), contributions will be calculated on the difference of Ksh.99,000.
At 6 percent, the employee will contribute Ksh.5,940 and the employer will match this amount. Tier II contributions will therefore total Ksh.11,880.
This brings the maximum mandatory NSSF contribution to Ksh.12,960 per month for employees earning Ksh.108,000 or more.
What this Means for Employers
Employers will need to update their payroll systems to reflect the new limits to ensure correct deductions from February 2026. The higher thresholds also mean an increase in employer pension costs, which should be factored into budgeting plans.
Employers also have the option to redirect Tier II contributions to a private pension scheme registered by the Retirement Benefits Authority (RBA). However, this requires notifying the RBA at least 60 days before making the change.
