How Kenya's New Labour Laws in 2025 Affect Freelancers and Gig Workers

Kenya's new labour laws in 2025 officially recognize freelancers and gig workers as a distinct workforce category with specific rights and obligations. This shift marks the first time the government has formally addressed the roughly 3 million people earning income through platform work, contract assignments, and independent projects. If you earn money through Uber, Bolt, Upwork, Fiverr, or direct client contracts, these changes affect your taxes, work classification, and access to benefits.

What Changed in the 2025 Labour Framework

The Employment and Labour Relations (Gig Economy) Amendment Act 2025 expanded the definition of "worker" to include anyone engaged in platform-based or project-based work for compensation. Previously, freelancers existed in legal gray area — not employees, not formally recognized. Now they are.

The law mandates platform operators (Uber, Bolt, Safaricom's digital platforms, and others) to provide basic protections: transparent payment terms, dispute resolution mechanisms, and data privacy safeguards. Payment deductions for platform fees or commissions must be disclosed upfront. Platforms can no longer deactivate accounts without written notice and a 14-day grace period to respond to alleged violations.

For individual freelancers not tied to platforms, the law requires written agreements with clients specifying payment terms, scope of work, and termination conditions. Verbal agreements no longer hold legal weight for disputes.

Tax Registration and Compliance Requirements

All gig workers earning above KSh 100,000 annually must now register with the Kenya Revenue Authority (KRA) using the iTax portal at itax.kra.go.ke. This includes ride-hailing drivers, delivery workers, freelance designers, and consultants.

You'll need your Identification Card number and M-Pesa account to complete registration. Once registered, you'll receive a Personal Identification Number (PIN) for filing quarterly returns. The KRA updated its iTax system in January 2026 to include a dedicated gig worker section with simplified filing requirements.

Tax bands remain unchanged: you pay 10% on income between KSh 100,000 and KSh 500,000, and 15% above that. However, gig workers can now claim legitimate business expenses — internet costs, phone bills (proportional usage), equipment, and platform fees — as deductions before calculating tax. Keep receipts. The KRA's verification process for expense claims takes 30-45 days.

If you earn below KSh 100,000 annually, registration is voluntary but recommended. Unregistered workers face a 20% penalty on any discovered income.

Insurance and Benefits Access

The law does not mandate employers to provide health insurance to gig workers. However, the Social Health Insurance Fund (SHIF) now accepts individual freelancer contributions starting at KSh 500 monthly. You can enroll through ecitizen.go.ke or visit a NHIF office. Coverage includes outpatient and inpatient services at accredited facilities nationwide.

Retirement savings remain your responsibility. The law permits gig workers to contribute to Occupational Retirement Benefit Schemes (ORBS) independently. Most major schemes accept self-employed contributions of at least KSh 1,000 monthly.

Workers injured on duty through platform work can claim compensation if they have registered with the National Hospital Insurance Fund or equivalent. Documentation of the incident and medical records are required.

What Gig Workers Need to Do Now

First, assess your annual income. If you exceed KSh 100,000, register with KRA immediately — the deadline for 2025 income was March 31, 2026, and late registration carries penalties.

Second, formalize agreements with clients or platforms. If you work through multiple clients, request written contracts specifying payment schedules and deliverables. If you use platforms like Uber or Bolt, download and save all terms of service updates; they're now legally binding.

Third, consider joining a gig worker association. Organizations like the Kenyan Gig Workers Union now provide collective bargaining support and legal representation for disputes with platforms. Membership costs KSh 500 annually.

Freelancers seeking stable, long-term clients can explore verified Kenyan freelancers on Kaziiko who have completed compliance training and maintain transparent client relationships.

The 2025 labour laws provide overdue clarity for a workforce that drives a significant portion of Kenya's economy. They also create responsibility. Registration, tax filing, and written agreements are no longer optional.

Frequently Asked Questions

Do I need health insurance as a gig worker?

No, the law does not mandate it. However, you can enroll in SHIF individually for KSh 500 monthly, or use private insurance. Many gig workers combine SHIF with a low-cost private plan for wider coverage.

What happens if I don't register with KRA?

If discovered earning above KSh 100,000 without registration, you face a 20% penalty on undeclared income plus interest. The KRA uses platform data from Uber, Bolt, and Safaricom to cross-check unregistered workers.

Can platforms deactivate my account without reason?

No. Platforms must provide written notice detailing the violation and give you 14 days to respond before deactivation. Unexplained account suspensions can be contested through the platform's grievance mechanism or escalated to the Labour Commissioner.

Are written agreements with clients legally binding?

Yes. Verbal agreements are no longer recognized for disputes under the new law. Any contract worth more than KSh 50,000 should be in writing and signed by both parties.