Hiring Employees in Kenya as a Foreign Company
How a foreign company can hire in Kenya: set up an entity, use an employer of record, or engage contractors - plus registrations, contracts and checks.
By Paul Omondi, Founder & CTO · Updated
A foreign company has three ways to hire people in Kenya: register a Kenyan entity and employ staff directly, use an employer of record (EOR) that employs them on your behalf, or engage independent contractors. Whichever you choose, the people working for you are protected by Kenya's Employment Act 2007, and someone must run Kenyan payroll with statutory deductions.
This guide explains each route, when it fits, and the steps to hire your first employees.
Three ways to hire in Kenya
| Route | Who is the legal employer | Best when |
|---|---|---|
| Your own Kenyan entity (branch or subsidiary) | You | You plan a long-term team, an office, or to sell and invoice in Kenya |
| Employer of record (EOR) | The EOR, a Kenyan company | You want to hire a few people quickly, test the market, or avoid setting up an entity yet |
| Independent contractors | Nobody - a commercial contract | The work is genuinely project-based and the person runs their own business |
Route 1: Set up your own Kenyan entity
Foreign businesses register through the Business Registration Service (BRS) on eCitizen. There are two forms:
- A foreign company (branch), registered under Part XXXVII of the Companies Act 2015. You file certified copies of the parent company's certificate of incorporation and constitution, details of its directors and shareholders, and appoint at least one local representative resident in Kenya to accept documents on the company's behalf. Foreign documents usually need to be notarised or apostilled.
- A Kenyan private limited company, owned by the parent as a subsidiary. This is a separate legal person, which many investors prefer for limiting liability and for local contracting.
Once the entity exists, register it as an employer before the first payroll (see the checklist below).
Route 2: Use an employer of record
An employer of record is a Kenyan company that becomes the legal employer of your staff. You choose the people and direct their work; the EOR issues the contracts, runs payroll, remits statutory deductions and handles HR administration, for a monthly fee.
If you use an EOR, check that it:
- Is a registered Kenyan company with a KRA PIN and employer registrations for NSSF, SHA and the Housing Levy.
- Gives you proof that statutory deductions are actually remitted each month, not only shown on payslips.
- Uses Employment Act-compliant contracts, including notice, leave and termination terms.
- Assigns intellectual property created by the employees to your company.
- Explains what happens to the employees if you end the EOR arrangement.
Using local staff can create tax questions for the foreign parent, such as whether it has a permanent establishment in Kenya. Take tax advice before the team grows.
Route 3: Engage independent contractors
Contractors suit genuinely project-based work by people running their own business. Be careful with long-term, full-time "contractors": Kenyan courts look at the real relationship - who controls how, when and where the work is done, whether the person is integrated into your business, and how long it lasts. A worker treated as an employee in practice is likely to be found to be one, with Employment Act rights to notice, leave and fair termination.
The Employment Act also converts casual work: a casual employee who works continuously for the equivalent of one month or more is treated as employed on monthly terms.
Checklist: before your first hire
- Get a KRA PIN for the entity and register for PAYE on iTax.
- Register as an employer with NSSF and with the Social Health Authority (SHA) for SHIF.
- Register for the Affordable Housing Levy and the NITA training levy.
- Get a county business permit for your premises.
- Choose a payroll system that calculates PAYE, NSSF, SHIF and the Housing Levy and pays staff to bank or M-Pesa. See Kenya payroll for foreign employers.
- Prepare a written contract template - the Employment Act requires one for employment of three months or more. See Kenya labour laws for employers.
Recruiting in Kenya
- Advertise widely. Many Kenyan jobseekers search on phones and apply through job links and WhatsApp, so keep applications short and mobile-friendly.
- Never charge candidates. Asking for application, interview or "processing" fees is a known scam pattern in Kenya and damages your reputation. See our ethical hiring policy.
- Run consent-based background checks on finalists: identity, education, employment history and criminal record. See how to run a legal background check in Kenya.
- Bringing in foreign staff? They need a work permit before they start - usually a Class D permit. See Kenya work permits for foreign employees.
Pay attention to the first contract you sign. Notice periods, probation, leave and termination terms in your Kenyan contracts must meet the Employment Act's minimums. A template copied from another country often does not.
How Cazini helps
Cazini is one system for hiring, background checks, HR and payroll in Kenya: post jobs free and screen candidates with AI, run consent-based checks, put new hires on contracts, and run Kenyan payroll with PAYE, NSSF, SHIF and Housing Levy - paying salaries straight to M-Pesa and bank. See hiring and payroll.
Sources
- Business Registration Service (eCitizen)
- Employment Act, 2007 (Ministry of Labour copy, PDF)
- Cogency Global: registration of a company in Kenya
Frequently asked questions
Can a foreign company hire employees in Kenya without a local entity?+
Not directly as the legal employer in most cases. A foreign company usually either registers a Kenyan entity (a branch or a local subsidiary), or uses an employer of record (EOR) - a Kenyan company that legally employs staff for it and runs Kenyan payroll and compliance.
What is an employer of record in Kenya?+
An employer of record is a Kenyan-registered company that becomes the legal employer of your staff in Kenya. It issues Employment Act-compliant contracts, runs payroll and remits PAYE, NSSF, SHIF and the Housing Levy, while you direct the employees' day-to-day work.
How does a foreign company register in Kenya?+
Through the Business Registration Service on eCitizen, either as a foreign company (branch) under Part XXXVII of the Companies Act 2015, with a local representative resident in Kenya, or by incorporating a Kenyan private limited company as a subsidiary.
Can I hire Kenyans as contractors instead of employees?+
You can engage genuine independent contractors, but Kenyan courts look at the real relationship, not the label. If you control how, when and where someone works on an ongoing basis, they are likely an employee, with the rights the Employment Act gives.
Do I need a work permit to employ a foreigner in Kenya?+
Yes. Foreign nationals employed in Kenya need a work permit - usually a Class D employment permit - from the Directorate of Immigration Services before they start work.
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