Secondment to Kenya: Who Is the Employer and What the Law Requires

Foreign groups often send managers and specialists to their Kenyan subsidiary on a “secondment” and assume the home contract governs. Kenyan law asks three separate questions. Who is the employer for the purposes of the Employment Act and tax? May the person lawfully work here at all? And which home-contract terms survive the Employment Act’s minimum standards? This guide explains how the courts and statutes treat a secondment to Kenya and what to settle before the secondee arrives.

Three structures, and why the facts matter more than the label

A group can place a person in Kenya in three broad ways. The Kenyan entity can sign its own employment contract with the individual. The home entity can keep the employment and lend the person to the Kenyan entity, which supervises the work and reimburses the cost. Or the group can supply the individual under a services or management agreement with no employment contract in Kenya.

The Employment Act defines an employer as any person, public body, firm, corporation or company that has entered into a contract of service to employ an individual, and includes its agent, foreman, manager or factor. In Kenya Methodist University v Kaungania, the Court of Appeal reasoned that the substantive and principal employer of a seconded person is the entity that assigns the specific duties and pays the remuneration, while the seconding entity is the nominal or residual employer whose powers revive when the secondment ends. The host there had issued its own appointment letters, paid the salary, remitted pension contributions and specified the duties, and the Court treated it as the principal employer.

The Tax Appeals Tribunal took a similar view of a Kenyan company’s secondment of staff to an Ethiopian affiliate in Safaricom PLC v Commissioner of Domestic Taxes. It held that the host, which had its own assignment agreements with the secondees and directed their work, was the principal employer, and that the Kenyan company, which remained the residual employer and only disbursed pay that the host reimbursed, had no PAYE obligation. That was an outbound secondment decided by a first-instance tribunal on its own contract terms, so take tax advice on how it applies to an inbound arrangement. We did not find a reported appeal when we checked in September 2026.

Recharges are a separate tax question. In M-Pesa Foundation Charitable Trust v Commissioner of Domestic Taxes, the Tribunal held that a payment reimbursing staff costs under a secondment arrangement was consideration for the supply of employees on secondment, so it was a management or professional fee on which withholding tax was deductible, even though there was no mark-up. That case involved two Kenyan entities, so take advice on how it applies to reimbursing a foreign parent for a secondee’s cost, and say in the agreement what the recharge is.

The secondee keeps Employment Act protections

Section 3(1) of the Act applies to all employees employed under a contract of service by any employer. Section 3(6) makes its terms minimum terms and declares null and void any agreement to relinquish, vary or amend them. A home-country contract that falls below the statutory floor therefore does not bind the secondee in Kenya to the extent of the shortfall.

The floor includes at least twenty-one working days of annual leave (section 28), three months’ maternity leave and two weeks’ paternity leave (section 29), sick leave (section 30), twenty-eight days’ written notice for monthly-paid staff unless the contract gives longer (section 35), and severance of not less than fifteen days’ pay for each completed year on redundancy (section 40). Termination for misconduct requires notice and a hearing under section 41, and an unfair termination can attract compensation of up to twelve months’ gross pay under section 49(1)(c). Section 9(1) requires a written contract for engagements of three months or more, and section 10 lists its particulars.

Drafting points for the Kenyan side

Name the employer and the fate of the home contract. State whether the home employment is suspended or continues, who pays, who directs the work, and who disciplines.

Write in the recall right. In Kaungania, the seconding body withdrew its approval and the host dismissed the two employees. The Court held that the contracts gave the approving body no role, so the withdrawal had no effect on them, the dismissal was unfair, and the employees received pay for the unexpired term plus notice pay. If the parent must be able to recall a secondee, the host contract should say so, with a notice period and the consequences.

Keep the discipline process local. A parent’s instruction to dismiss does not displace sections 41, 43 and 45. Our guides to the show cause letter and the internal appeal cover the process.

Consider a security bond. Section 23 allows the Cabinet Secretary to require an employer that is not incorporated or resident in Kenya to pay a bond equal to one month’s wages for all employees employed or to be employed.

Immigration: the secondee needs the right permit, and so does the structure

Under section 34 of the Kenya Citizenship and Immigration Act, a non-citizen’s presence is unlawful unless they hold a valid work permit, residence permit or pass. Section 45 sets the employer’s duties. No person may employ a foreign national whose status does not authorise employment, or on terms or in a capacity different from those authorised. The employer must apply for and obtain the permit or pass before granting employment, and it is presumed to have known if it did not. It must keep the prescribed records for two years after the employment ends and file a report with the Service.

Section 45(5) matters for secondments. A person who performs, for the benefit or at the request of another, work of a kind commonly performed by an employee is deemed to engage in employment, and that other person is treated as employing them. Calling the arrangement a services agreement therefore does not remove the permit requirement for the host.

Section 41(1) provides that a permit ceases to be valid if the holder stops engaging in the employment for which it was issued, or engages in any other employment, occupation, trade, business or profession. In our reading, moving a secondee between group entities or roles needs a fresh or varied permit first. Employing a foreign national in a capacity not authorised is an offence under section 53, carrying on conviction a fine of up to five hundred thousand shillings, imprisonment for up to three years, or both.

For the usual employment route, the Directorate of Immigration Services’ Class D page says the permit is for specific employment by a specific employer, for a person with skills not available in Kenya. Its listed requirements include the details, certificates and CV of a Kenyan understudy, and evidence that the employer tried to fill the vacancy locally through competitive recruitment. See our guide to work permit classes.