Court rules SRC has final say on salaries in state corporations
The Court of Appeal has overturned a ruling by the Employment and Labour Relations Court (ELRC), affirming that the Salaries and Remuneration Commission (SRC) has jurisdiction over the remuneration and benefits of public officers in all State corporations, including the National Social Security Fund (NSSF).
In a judgment delivered on February 28, 2025, the appellate court ruled that NSSF employees are public officers subject to SRC’s authority under Article 230 of the Constitution of Kenya, 2010.
The decision set aside an earlier ELRC ruling that had declared SRC’s July 4, 2012, circular inapplicable to State corporations.
“In reaching the conclusion that the employees of the NSSF are not subject to the requirements of the Salaries and Remuneration Commission Act and regulations, we find that the Employment and Labour Relations Court misapprehended the Constitution and the law, and in so doing, arrived at the wrong decision, as a consequence of which it is necessary to interfere with that decision,” the ruling stated in part.
The case dates back to 2016, when NSSF, the Kenya Union of Commercial Food and Allied Workers, and the Attorney General challenged SRC’s directive regulating salary negotiations at NSSF.
While the ELRC initially ruled in favor of the respondents, the SRC appealed, arguing that its constitutional mandate to oversee the remuneration of public officers had been curtailed.
A three-judge bench comprising Justices Asike Makhandia, Agnes Kalekye Murgor and Sankale ole Kantai upheld SRC’s appeal, emphasizing that the commission has the constitutional authority to regulate salaries in State corporations.
The court ruled that as long as salaries in State corporations are funded through Parliament’s annual budget or funds retained by the corporation under an Act of Parliament, SRC retains the mandate to determine all remuneration and benefits.
The judgment provides clarity on SRC’s role in managing public sector pay at both the national and county government levels, reinforcing its oversight as enshrined in the Constitution and the Salaries and Remuneration Commission Act, 2011.
