Government Considers Kenyans Working Abroad To Pay Mandatory Welfare Levy

    Labor Principal Secretary, Geoffrey Kaituko | PHOTO/COURTESY |

    The Kenya Ministry of Labor is reviewing a proposal that would require all Kenyan citizens working abroad to contribute to a state-managed welfare scheme.

    If approved, this initiative, named the Kenya Migrant Workers Welfare Fund, aims to provide essential assistance to migrant workers, including relief, disability benefits, medical aid, and support for the families of deceased workers.

    Under the proposal, every migrant worker would need to register as a member of the fund before leaving the country for work abroad. Furthermore, fees collected by private employment agencies, known as contingency fees, would be channeled into this welfare fund according to the Business Daily.

    The Labor Principal Secretary Geoffrey Kaituko, explained the fund, saying, “This is a contributory fund in which the government would also allocate funds. This innovative fund seeks to address the concerns of migrant workers, offering them a safety net during difficult times. The objective is to enhance the oversight of labor migration, as existing laws fall short in addressing the issues faced by migrant workers.”

    The specific contribution rate for each migrant worker will be determined later through regulations. These funds will offer mandatory insurance, repatriation coverage, educational scholarships for workers’ children, and loan programs in collaboration with banks to support migrants’ re-departure expenses and self-employment ventures.

    The Kenya Migrant Workers Welfare Fund, as proposed, would be overseen by a board led by a chairman appointed by the President.

    The global chairman of the Kenya Diaspora Alliance Shem Ochuodho, expressed support for initiatives prioritizing the welfare of migrant workers. He emphasized the importance of transparency in fund management and noted that the level of deductions would be acceptable if the funds were utilized effectively.

    The majority of Kenyan diaspora members reside in the United States, the United Kingdom, the United Arab Emirates, Canada, Australia, and South Africa. The proposed bill also includes the establishment of a multi-agency committee responsible for vetting private employment agencies. This move is in response to documented challenges faced by migrant workers, particularly in Gulf countries.

    The Ministry of Foreign Affairs reported that between 2020 and 2021, at least 89 Kenyan nationals, many of whom worked as domestic help, lost their lives in Saudi Arabia.

    A dispute consultant at Kibali Labor Consultants and Agencies, Harrison Nyando, emphasized the potential significance of the contributory scheme in monitoring the welfare of migrant workers. He stressed that authorities might view the absence of such deductions as a cause for concern.

    While migrant workers occasionally require welfare assistance, it is important to note that the diaspora population plays a crucial role in Kenya’s economy, with remittances being a significant source of foreign currency, second only to foreign direct investments, according to data from the Central Bank of Kenya (CBK). As of July, remittances stood at Sh352.2 billion, marking a modest increase of two percent compared to the same period the previous year.