The Federation of Kenya Employers (FKE) has issued a crucial advisory to its esteemed members following a Court of Appeal ruling that dismisses a Stay Application filed by the government.

FKE advised its members not to deduct the Housing Levy unless otherwise prescribed by the court.

The ruling, delivered on January 26th, 2024, has far-reaching implications, particularly concerning the Affordable Housing Levy, as the court emphasized that the levy was introduced without a legal framework.

In the advisory addressed to its members, FKE Executive Director and CEO Jacqueline Mugo highlighted the significance of the court's decision.

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"We advise our members not to deduct the levy unless the Court of Appeal rules otherwise after the hearing of the substantive appeal or, in the alternative, should the government challenge the said ruling in the Supreme Court, the said Court reverses the ruling delivered today," stated Mugo.

The Court of Appeal's decision stemmed from a Stay Application in which the government sought to continue collecting the Housing Levy until the appeal it filed is heard and determined.

However, the court, in dismissing the application, underscored the lack of a legal framework for the levy's introduction and based its decision on public interest, favouring a halt to the deduction pending the hearing and determination of the appeal.

FKE reassured its members that it would closely monitor any developments in the matter, with a commitment to promptly inform them of any changes or updates.

Mugo urged employers to stay informed on the issue and advise their employees accordingly.

"Our commitment is to keep you informed promptly of any changes or updates. We encourage you to stay informed on this issue and advise your employees accordingly," FKE stated.

This landmark ruling has introduced uncertainty into the implementation of the Affordable Housing Levy, marking a potential shift in the legal landscape surrounding mandatory deductions.

As employers grapple with the implications, the FKE remains a vigilant voice, navigating its members through this uncharted territory with timely and informed advisories.