The Government of Kenya through the Cabinet Secretary for the National Treasury and Planning has, through Legal Notice Number 88 of 2019 dated 13th June, 2019 (copy attached for your reference), amended the Retirement Benefits (Occupational Retirement Benefits Schemes) Regulations, 2000 (the “Regulations”).
Legal Notice Number 88 of 2019 dated 13th June, 2019 amended the, Retirement Benefits (Occupational Retirement Benefits Schemes) Regulations 2000 (the “Regulations”).
Regulation 19 (5) (a) (ii) has been amended to now read as follows: “the scheme rules shall provide that: where a member leaves employment after vesting of his benefits but before attaining the specified early retirement age, he may opt for payment of his own contribution where he is a member of a defined contribution scheme. The effect of this amendment is that where employment is terminated before the employee has reached the retirement age provided for in the Trust Deed and / or the Pension / Provident Fund Rules, they will no longer be entitled to the employer’s portion of contributions and the investment income gained from the contributions until they attain the retirement age. This alters the previous position under the Regulations where an employee was entitled to his contribution in full plus 50% of the employer’s contribution and the investment income that had accrued from the said contributions.
The Legal Notice is effective from 17th June, 2019. Employers will need to amend the Trust Deeds and Rules of Provident Funds / Pension Schemes to align them with this position.