The Federation of Kenya Employers (FKE) has issued an advisory to its members to stop deducting housing levy from the pay slips of salaried workers following the move by the appellate court to halt the deductions.
This follows the court of appeal ruling today January 26th 2024 that dismissed a stay application where the government sought to continue collecting the housing levy until the appeal it filed is heard and determined.
In dismissing the application, the Appellate Court noted that the levy was introduced without a legal framework.
Further, the Court of Appeal indicated that its decision was based on public interest, which in the case was in favor of halting the deduction pending the hearing and determination of the Appeal.
“In light of the court order, we advise our members, not to deduct the levy unless the Court of Appeal rules otherwise after the hearing of the substantive appeal or in the alternative, should the government challenge the said ruling in the Supreme
Court, the said Court reverses the ruling delivered today,” stated FKE Executive Director and Chief Executive Officer (CEO) Jacqueline Mugo.
“The Federation shall continue to monitor any developments in this matter. Our commitment is to keep you informed promptly of any changes or updates,” she added.
Appellate Court judges Lydia Achode, John Mativo and Paul Gachoka cited public interest in the matter, underscoring the High Court ruling that the Housing Levy was introduced without a legal framework.
“The trial Court held that the Housing Levy was introduced without a legal framework. It also held that the levy was targeting a section of Kenyans. In our view, public interest lies in awaiting the determination of the appeal,” reads the court ruling in part.
“This is because if the stay sought is granted at this stage, should the appellate Court affirm the impugned decision, then some far-reaching decisions that will have been undertaken pursuant to the impugned laws may not be reversible,” it added.