Court okays controversial NHIF rates

September 27, 2010 12:00 am

, MOMBASA, Kenya, Sep 27 – Kenyan workers will now have to dig deeper into their pockets to pay controversial new National Hospital Insurance Fund (NHIF) rates after the industrial court threw out a case challenging its legality.

The Central Organisation for Trade Union (COTU) and Federation of Kenya Employers (FKE) had sought to block the new contribution.

This means that employers can now implement the new worker\’s contributions that will see the NHIF commence provision of Outpatient Care Services from next month.

Industrial Court judge James Rika who was sitting in Mombasa on Monday ruled that the applicants\’ case was \’baseless\’.

He declined to suspend the implementation of the new rates which will now become effective from September 1 after they were gazetted in June this year.

Justice Rika said the new contribution rates were reached after thorough and intensive social dialogue and with comparative study tours, feasibility and actuarial surveys.

The judge argued that there was no bias on the ruling adding no social partner behaved like a dictator.  

Justice Rika insisted in his judgment that the scheme does not offend the Constitution or legislation, governance and management questions.         

COTU through their lawyer Ms J.A Guserwa had moved to court to challenge the implementation of the revised rates saying the workers umbrella body had not been consulted at the NHIF board level.

The worker\’s body had claimed that without observing industrial relations and requirements of section 5(e) of the NHIF Act, the board issued a notice on July 2, 2010 announcing the new rates to be effected against the workers\’ salaries against their will.

COTU and FKE lawyers vowed to move to Court of Appeal to have the ruling reversed.

The National Hospital Insurance Fund recently gazetted new contributory rates that moved away from the Sh320 maximum contribution to a progressive rate of up to Sh2, 000.

The lowest contributor would now pay Sh150 which applies to those earning less than Sh6, 000, while the highest contributor will fork out Sh2,000 for those earning more than Sh100,000.



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