NSSF Contributions Guide
NSSF contributions are the quiet line on a construction payslip that employers most often under-calculate, especially where wages swing between short weeks and long ones. The rules are not complex: a Tier I rate on the lower band of pensionable pay, a Tier II rate on the band above it, and an employer match on both. But because casual wages move, contractors who deduct a flat amount always end up wrong. Here is how NSSF works on a Kenyan construction payroll.
Updated October 17, 2026 · Guides
Tier I and Tier II explained
Under the NSSF Act 2013, contributions are split into two tiers of pensionable pay. Tier I covers the lower band up to KES 8,000, and Tier II covers earnings between KES 8,001 and KES 72,000. The employee contributes a percentage of each tier, and the employer matches it. Earnings above KES 72,000 a month do not attract further NSSF contribution.
- Tier I — 6% of pensionable pay up to KES 8,000, a maximum of KES 480 from the worker.
- Tier II — 6% of earnings between KES 8,001 and KES 72,000, a maximum of KES 3,840.
- The employer pays the same amount again, so the total contribution is double the worker's deduction.
What casual workers are owed
Construction runs on casual labour, and casual workers are not exempt from NSSF. A worker who is on your site week after week is your employee for pension purposes, and contributions should be deducted and remitted on their behalf. Because a casual's monthly pay varies, the Tier I and Tier II split must be recomputed each month from actual earnings rather than a fixed figure. A worker whose total monthly pay is below the Tier I ceiling still contributes — just on the lower band. Because the tier boundary is fixed in shillings, a worker whose monthly total crosses KES 8,000 in a busy month pays both tiers, while a short month may attract only Tier I.
The monthly deadline
NSSF contributions are deducted from wages and remitted monthly, with the return due by the 9th of the following month. The contribution schedule must name each worker and show their earnings and the amount remitted. Late or partial remittance attracts penalties, and because workers can check their own NSSF statements, a discrepancy usually surfaces as a complaint from the worker long before it surfaces as a fine.
Getting NSSF right on site
The reliable way to handle NSSF on a construction payroll is to compute it from the same locked attendance data that drives wages, every pay run, per worker. FundiPay does exactly that: it applies Tier I and Tier II to each fundi's actual earnings, adds the employer match, and rolls the result into the statutory return — so the schedule, the payslip and the remittance always agree. It also keeps the employer match visible, so the true cost of a crew is never a surprise at month end.
Frequently asked questions
Do casual construction workers need NSSF contributions?
Yes. Workers who are regularly on your site are employees for pension purposes, and contributions should be deducted and remitted on their behalf. Casual status does not exempt them.
What is the maximum monthly NSSF deduction?
The worker's contribution caps at KES 480 for Tier I and KES 3,840 for Tier II, with the employer paying a matching amount. Earnings above KES 72,000 a month do not attract a further contribution.
When are NSSF contributions due?
Contributions are remitted monthly, with the return due by the 9th of the following month. Late remittance attracts penalties, and workers can see their own statement, so errors rarely stay hidden.
How do I handle NSSF when casual wages change every month?
Recompute the Tier I and Tier II split from each worker's actual monthly earnings every run, rather than deducting a flat amount. FundiPay does this automatically from the locked muster roll and wages.
Keep reading
Product
Automated Statutory Deductions
FundiPay calculates PAYE, NSSF, SHIF and the Affordable Housing Levy per worker and prepares the returns, keeping site payroll compliant.
Guides
PAYE for Construction Workers
How PAYE works for Kenyan construction crews — tax bands, personal relief, casual daily wages, and the mistakes that trip up site payrolls.
Glossary
NSSF (National Social Security Fund)
Kenya's National Social Security Fund pension scheme, to which an employer deducts 6% of pensionable pay and adds an equal employer share.
Guides
Payroll Statutory Calendar
The monthly construction payroll calendar in Kenya: PAYE, NSSF, SHIF and housing levy returns due by the 9th, what to prepare and the cost of lateness.