Teachers will begin contributing higher amounts to the National Social Security Fund (NSSF) starting this month, following the implementation of Year 4 contribution rates effective February 2026.
The new rates, announced by the NSSF under the Third Schedule of the NSSF Act (Cap 258), raise the maximum monthly contribution per employee to Sh12,960.
This is split between Tier 1 contributions of Sh1,080 and Tier 2 contributions of Sh11,880. Employers are required to remit the deductions by the 9th of each subsequent month.
For thousands of teachers employed by the Teachers Service Commission (TSC), as well as those in private schools, the changes mark a notable shift in retirement savings obligations.
Under the new structure, the Lower Earnings Limit (Tier 1) has been set at Sh9,000, attracting a 6 per centper cent contribution from both the employee and the employer — translating to Sh540 each, or Sh1,080 total per teacher.
The Upper Earnings Limit (Tier 2) has now been raised to Sh108,000. This means teachers earning at or above this threshold will contribute up to Sh5,940 each (employee and employer) under Tier 2, for a total of Sh11,880.
Combined with Tier 1, this brings the maximum monthly contribution to Sh12,960 per teacher.
Education sector payroll officers confirm that teachers earning above Sh108,000 — particularly senior secondary school principals, curriculum support officers, and administrators — will feel the full impact of the revised deductions.
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This occurs when tutors are grappling with increasing statutory deductions, such as the revised pension frameworks and housing levy.
Private school teachers, many of whom previously contributed to NSSF at lower flat rates before the phased reforms started in 2023, will face the higher adjustment.
School owners now fully comply with the structured, tiered contribution system, and the Teachers Service Commission is expected to automatically integrate the revised contribution rates into its payroll system, ensuring compliance with the February 2026 implementation timeline.
The Fund has announced a 17 per cent net interest rate for the 2024/2025 Financial Year.
The net was approved at the 8th Annual General Meeting held this month.
This means that tutors’ accumulated savings will earn a substantial return, potentially strengthening retirement security.
Employers who fail to remit contributions by the 9th of each month risk penalties under the NSSF Act.
For teachers, the key question remains the balance between immediate take-home pay and long-term retirement security.
While monthly deductions will increase, the 17 per cent declared interest may offer reassurance that the savings are growing meaningfully.
By Joseph Mambili
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