Expanding into Kenya? Whether you’re a global company or a startup seeking to build a distributed team, navigating employment laws, taxes, and HR compliance can be challenging. That’s where TaxAfic comes in. As a trusted Employer of Record in Kenya, we manage the complex local employment responsibilities so you can focus on scaling your business.
Our Kenya EOR services ensure your team is legally employed, paid on time, and fully compliant with Kenyan labor laws, without you needing to establish a legal entity.
What Is an Employer of Record in Kenya?
An Employer of Record (EoR) in Kenya is a third-party organization that hires employees on behalf of another company. We handle all HR, legal, tax, and compliance responsibilities, allowing your business to operate in Kenya efficiently and lawfully.
Navigating Employment Compliance in Kenya
In Kenya, businesses must operate within a framework of employment regulations designed to protect both employers and employees. These legal requirements cover every aspect of the employment lifecycle, including recruitment, onboarding, employee relations, payroll management, taxation, benefits, and termination procedures. Ensuring full compliance is crucial, as violations can lead to significant penalties and legal issues.
Below is an overview of the key employment contract types recognized under Kenyan labor law:
- Types of Employment Contracts in Kenya
- Permanent Contracts (Open-Ended)
These contracts do not have a predetermined end date and are used for long-term employment. Employees typically receive comprehensive benefits such as paid leave, statutory contributions, and job security. - Fixed-Term Contracts
Designed for employment over a set period (e.g., six months or one year), these contracts are suitable for project-based assignments or roles with a clearly defined duration. - Probationary Contracts
Often used during the initial hiring phase, probation contracts usually span up to six months, with a possible extension to 12 months. They allow employers to evaluate an employee’s performance before transitioning them into a permanent role. - Casual Employment Contracts
Casual workers are engaged on a daily basis, with employment not exceeding 24 consecutive hours. Payment is made daily, and there are no long-term employment commitments from the employer. - Part-Time Contracts
These agreements are structured for employees who work fewer hours than full-time staff. Part-time contracts support flexible scheduling and are often tailored to specific operational requirements.
Employment Termination in Kenya
In Kenya, ending an employment relationship can be initiated by either the employer or the employee. In most cases, written notice is required, although the length of the notice period depends on the type of employment agreement and how the employee is paid. For instance, those paid monthly typically need 28 days’ notice, while daily workers can be let go at the end of the day without any formal notice. If an employment contract outlines a different notice period, that agreement takes priority.
Key Points on Employment Termination:
Notice Period Requirements:
- Daily Workers: No notice is required; employment can end at the close of any working day.
- Weekly or Bi-weekly Workers: One or two weeks’ notice is usually needed, or payment in place of that notice.
- Monthly or Longer-Term Workers: A 28-day written notice is standard unless otherwise specified in the contract.
- Probationary Employees: A seven-day notice or equivalent compensation applies.
- Contractual Terms: If the contract defines a specific notice period, it overrides the general rules.
Reasons for Termination:
- Employer-Initiated: Employers may dismiss staff for valid reasons such as misconduct, poor job performance, or health-related incapacity—but must follow the correct procedures.
- Employee-Initiated: An employee can resign at any time but may be expected to either serve the notice period or compensate for it.
- Mutual Separation: Both parties may agree to end the employment voluntarily.
- Automatic Termination: Contracts can end automatically due to factors like the employee’s death, business closure, or the end of a fixed-term contract.
Fair Process Must Be Followed:
- Employers must clearly communicate the reasons for dismissal.
- Employees have the right to respond and provide their side of the story.
- During disciplinary hearings, workers can bring a representative for support.
Unfair Termination:
- If the dismissal lacks valid grounds or bypasses due process, it may be deemed unfair.
- Affected employees can challenge such decisions through the appropriate legal channels.
Compensation Instead of Notice:
- If either party doesn’t provide the required notice, they must compensate the other by paying an amount equal to the wages for the notice period.
- This rule applies equally to employers and employees.
Redundancy and Retrenchment:
- When reducing staff due to economic or structural reasons, employers must follow legal guidelines, which include employee consultation and paying severance.
Legal Framework and Guidance:
- The Employment Act of Kenya outlines all rules governing job termination.
- Understanding these laws is critical for both employers and workers.
- Seeking legal advice can be beneficial in complex or disputed termination cases.
What Our Kenya Employer of Record Services Cover
At TaxAfic, our EoR services in Kenya include full-service employment compliance, payroll, HR, and ongoing support. Here’s what we handle on your behalf:
- Drafting Compliant Employment Contracts
Kenyan law requires that employment contracts be written in English and include details such as:
• Job title and description
• Salary and benefits
• Working hours and leave entitlements
• Termination clauses
We ensure every employment agreement meets local regulatory standards. - Managing Working Hours Compliance
In Kenya, standard working hours are capped at 45 hours per week, with factory employees allowed up to 52 hours. Any additional hours are classified as overtime. We help you structure working hours appropriately and ensure compliance with labor laws. - Observing Public Holidays and Leave Entitlements
Employees under our EOR benefit from full observance of national holidays, including:
• New Year’s Day
• Good Friday
• Labor Day
• Madaraka Day
• Mashujaa Day
• Christmas and more
We also manage annual paid leave—21 days after one year of service—ensuring smooth vacation tracking and scheduling. - Visa & Work Permit Processing for Expats
Foreign employees must have valid work permits. Non-compliance can result in severe penalties, including up to 3 years imprisonment or a Kshs. 50,000 fine. We assist with:
• Work permit applications
• Renewals
• Immigration compliance - Payroll Management & Statutory Deductions
We handle complete payroll processing, including:
• NSSF (National Social Security Fund)
• SHA (Social Health Authority)
• PAYE (Pay As You Earn income tax)
• Union dues (if applicable) - Employee Transfer & Termination Support
Whether transferring employment or managing termination, we follow Kenyan best practices. We ensure:
• Timely employee notifications (minimum 1 month for monthly contracts)
• Legal termination notices
• Severance calculations
• Exit logistics and final payments
Why Choose TaxAfic as Your Employer of Record Kenya?
We’re more than a service provider—we’re your HR partner in Kenya. When you choose TaxAfic, you benefit from:
✅ Local Expertise – Deep knowledge of Kenyan employment laws and tax codes
✅ Fast Setup – Hire your team without the delays of entity registration
✅ Compliance Guarantee – Avoid penalties with our fully compliant HR processes
✅ Full Payroll & Tax Management – We handle all statutory remittances
✅ Work Permit Assistance – Hassle-free immigration support for your expat staff
✅ Employee Benefits & Support – We manage local employee relations for you
List of TaxAfic’s Employer of Record Services in Kenya
• Employment contract creation and onboarding
• Payroll processing and tax compliance
• Statutory deduction management (NSSF, SHA, PAYE)
• Work permit and visa support for expatriates
• Employee leave tracking and holiday observance
• Termination and severance management
• Compliance with working hours and overtime
• Labor law advisory and HR support
• Employment transfer facilitation
• Employee benefits administration
Conclusion
Hiring in Kenya doesn’t have to be complex. With TaxAfic’s Employer of Record Kenya services, you get peace of mind knowing your workforce is fully compliant, well-managed, and operating within legal boundaries. Let us handle the red tape so you can focus on business growth.
Ready to expand into Kenya without the hassle? Contact TaxAfric today and let us manage your employment needs with ease and professionalism.