Former employees of the defunct National Hospital
Insurance Fund, who have been absorbed by the Social Health Authority or
redeployed within the wider public service, will retain their last prevailing
salaries, a court has ruled.
Justice Byram Ongaya of the Employment and Labour Relations Court on Wednesday ordered that staff of the defunct NHIF, who will not be absorbed by SHA, will retain their previous salaries until they exit the public service.
The same applies to those who opt for redeployment elsewhere in the public service.
“Any letters already communicated to the staff of the defunct NHIF who have already been deployed within the wider public service be varied to reflect the retention of salary personal to self,” Justice Ongaya said in the orders issued on July 23, 2025.
The orders followed a petition by some of the former NHIF staff who had sought protection against reduced salaries as a result of being redeployed.
Of the 1,737 former staff of the now defunct NHIF, less than half (815) transitioned to SHA with the rest to be redeployed.
In May, the Public Service Commission announced that all ex-NHIF staff will continue serving under SHA for an additional period of six months.
PSC chairman Anthony Muchiri said the arrangement was to allow SHA complete its recruitment process.
"The move is intended to ensure uninterrupted service delivery and maintain operational stability during the transition period," he said.
In April, Justice Ongaya had issued orders requiring SHA to provide former NHIF staff with its establishment structure showing the total number of jobs, grades and remuneration available for them if they sought those jobs.
The court had also directed PSC to provide an exit package that will be applicable to ex-NHIF staff who would not be absorbed by SHA in the event they opted to retire.
However, after mediation involving the Public Service Commission, Social Health Authority and the former staff of NHIF, a consent was reached that those who will not be absorbed by SHA will be redeployed with their salaries not changed.
The applicants also agreed to withdraw a case they had filed against SHA chief executive Mercy Mwangangi for contempt of court orders.
“The application for contempt of court dated June 17, 2025, be and is hereby marked withdrawn,” Justice Ongaya said in his orders.
The court also set aside orders it had issued suspending recruitment of staff to positions such as quality assurance officers, county coordinators, directors, deputy directors, finance officers and accountants.
