Full employment cost: gross pay plus employer NSSF, housing levy and NITA.
Total cost to employer (monthly)
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Employer NSSF
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Employer housing levy
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NITA levy
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Annual cost to employer
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The gap between the offer letter and the budget line
When you offer someone a salary, that number is what they think about. When you build the payroll budget, it is the wrong number to plan around, because employing a person in Kenya costs more than the gross you quote. On top of gross pay an employer carries a handful of statutory on-costs that never appear on the employee's payslip as a deduction. This calculator turns a gross salary into the true monthly and annual cost to the employer, which is the figure a founder or finance lead actually needs when sizing a team or pricing a project.
What the employer adds, and what it does not
Three costs sit on the employer's side of the ledger in this tool. The first is the matching NSSF pension contribution, mirroring what the employee pays, currently capped at KES 6,480 a month per party under the tiered rates this calculator applies. The second is the employer's share of the Affordable Housing Levy, modelled at 1.5 percent of gross with no ceiling. The third is the National Industrial Training levy, a small fixed amount the tool treats as KES 50 a month per employee.
What this calculator correctly leaves out matters just as much. SHIF, the health contribution that replaced NHIF, is deducted from the employee, not paid on top by the employer. PAYE is likewise the employee's tax, withheld from their pay. Neither is an extra employer cost, so neither inflates the cost-to-employer figure here. All of these rates have shifted through recent Finance Acts and statutory notices, so treat them as the basis the tool uses and confirm the current position with the Kenya Revenue Authority and the relevant funds.
A 120,000 salary, fully loaded
Take a gross monthly salary of KES 120,000, the value the calculator opens with. The on-costs stack up like this, using the rates this calculator applies.
The on-costs come to KES 8,330 a month, only about 7 percent over the gross. That is a deliberately light statutory burden by international standards, and it is worth knowing when you compare hiring in Kenya with markets where employer social charges run far higher. The chart shows the gross salary against the slice of employer on-costs that sit on top.
Notice the NSSF line is flat at the cap. Above a gross of KES 108,000 the tiered contribution stops rising, so the NSSF cost is the same KES 6,480 whether the salary is KES 120,000 or KES 500,000. The levy and NITA behave differently: the housing levy keeps climbing at 1.5 percent of gross with no cap, while NITA is a fixed amount per head. For a high earner the housing levy becomes the dominant employer cost.
Why is SHIF not part of the employer cost here?
Because SHIF is borne by the employee. The 2.75 percent health contribution that replaced NHIF is deducted from the worker's gross pay, the same way PAYE is. The employer remits it to the fund but does not pay an additional matching amount on top, so it does not raise the cost to employer. This calculator reflects that by excluding SHIF from the on-costs. Always confirm the current SHIF rate and any employer obligation with the relevant authority, since the scheme is recent.
Does the employer cost change for very low salaries?
Yes, at the bottom the NSSF match is smaller because it is tiered on bands of pay rather than a flat percentage, so a low salary attracts less than the KES 6,480 cap. The housing levy still applies at 1.5 percent of whatever the gross is, and NITA stays fixed per employee. For minimum-wage roles the proportional on-cost is similar, but the shilling amounts are lower. Enter the actual gross to see the exact figure for that role.