The government will start deducting 1.5 percent housing levy from all employees in the public and private sector beginning March 1.
Transport, Housing and Infrastructure Cabinet Secretary James Macharia said the affordable housing project will be implemented after successful talks with workers’ union and employers.
“We had injunctions that halted the process but the parties have agreed to withdraw them so we are ready to proceed with the project,” Mr Macharia said.
Speaking in Nyeri on Tuesday where he was inspecting ongoing projects, Mr Macharia did not explain how the deal was reached with Central Organisation of Trade Unions (Cotu) who had filed a case in bid to stop the levy.
Cotu filed an urgent application in December last year at the Employment and Labour Relations Court challenging the levy’s legality.
Cotu Secretary General Francis Atwoli faulted the scheme which the government said will be deducted from employees basic salaries and remitted to the National Housing Development Fund.
In his application to stop the levy, Mr Atwoli said the scheme was too heavy a burden for Kenyan workers in wake of rising cost of living.