Severance Pay Calculator Kenya
Calculate statutory severance and redundancy packages accurately. This 2026 tool complies with the Kenya Employment Act, using the official formula of 15 days' basic pay per completed year of service, plus accrued leave encashment.
Enter basic pay excluding non-guaranteed allowances to find the standard daily rate.
*Severance packages are typically subject to standard PAYE tax deductions upon disbursement.
Understanding Severance Pay Rules in Kenya
Our Severance Pay Calculator operates strictly using the official parameters established under the Kenya Employment Act, Cap 226. It ensures full compliance when calculating redundancy and termination packages.
How Redundancy Compensation Works
According to Section 40 of the Employment Act, an employer must pay severance to an employee declared redundant. The law mandates a minimum payment of 15 days' basic wage for every completed year of employment.
| Component | Statutory Mandate | Calculation Logic |
|---|---|---|
| Severance Formula | 15 Days per Year | Base salary is divided by 30 to find the daily rate, multiplied by 15 days, and then multiplied by total completed years of service. |
| Leave Encashment | Accrued Days | Daily rate multiplied by the number of unused annual leave days. |
Frequently Asked Questions
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