Order against Housing Fund Levy extended as petitions merged

May 20, 2019 (5 weeks ago) 1:24 pm
The judge extended the interim orders barring the levy until hearing of the applications challenging execution of the Finance Act 2018 relating to payment of 1.5 per cent by employers and a similar percentage by employees/file

, NAIROBI, Kenya, May 20 – The Employment and Labour Relations Court has consolidated petitions challenging implementation of the Housing Fund Levy.

Justice Maureen Onyango said the applications filed by the Central Organisation of Trade Unions (COTU), Federation of Kenya Employers (FKE) and Consumer Federation of Kenya (COFEK) will be heard together and the matter will be mentioned on May 27, 2019 for directions.

The judge extended the interim orders barring the levy until hearing of the applications challenging execution of the Finance Act 2018 relating to payment of 1.5 per cent by employers and a similar percentage by employees.

COFEK lawyer Henry Kurauka told the judge that the Cabinet Secretary for Transport, Infrastructure, Housing, Urban Development and Public Works has already placed a public notice in the media announcing commencement of the Finance Act 2018 relating to the Housing Fund Levy.

The lawyer said that the decision by the CS to implement section 31 A of the Employment Act imposing the Housing Fund Levy is illegal, unconstitutional, discriminatory, oppressive irrational and has no basis.

Kurauka submitted that introducing the Housing Fund Levy is not a priority in Kenya, because there are more pressing issues like the 13 counties being ravaged by hunger and drought where farmers are unable to secure inputs, further coupled by health challenges including unmet expectations on the National Hospital Insurance Fund.

“There is a rising cost of living and poverty which the government must address first,” the lawyer said.

He argued implementation of the Housing Fund Levy will increase unemployment as many employers will resort to cut down their workforce to the detriment of the economy, saying that statutory amendments that increase the cost of human resource will create job crisis in the country.

“The said Housing Fund Levy does not guarantee that all contributors under the scheme would get houses after investing their money,” he observed.

The Fund is discriminatory to many citizens especially those who own their houses or retiring, people living with disability low income earners and retrenched workers.

The judge directed the CS and Attorney General to respond to the applications.

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