Kenyatta National Hospital (KNH) and Moi University recorded the highest number of employees receiving salaries outside the official government payroll during the financial year ending June 2025, according to a new compliance report by the Public Service Commission.
The report shows that KNH had 1,136 officers paid through alternative arrangements rather than the certified payroll system, the highest figure among 511 public institutions reviewed.
Moi University ranked second with 695 staff members receiving off-system payments. Together, the two institutions accounted for nearly half of all public servants identified as being paid outside the formal payroll structure.
Oversight agencies have repeatedly warned that paying employees outside the approved payroll can weaken financial oversight, obscure the true size of the public wage bill and create room for irregular salary payments. The continued use of such arrangements threatens government efforts to streamline and centralise payroll management following recent reforms in the public sector.
According to the commission’s findings, a total of 3,868 public officers from 72 institutions were paid outside the official payroll during the review period. This means 14.1 percent of the 511 evaluated public entities used alternative salary payment mechanisms.
The institutions assessed had a combined workforce of 244,208 officers, placing the share of employees paid outside the payroll at 1.6 percent of the total workforce.
The commission further noted that 778 officers, representing 20.1 percent of those paid off-system, received their salaries for more than 12 months. Another 748 officers, or 19.3 percent, were paid for periods ranging between seven and 12 months, while 181 officers, or 4.7 percent, were paid for between one and six months. However, the payment period for 2,157 officers, representing 55.8 percent, was not specified.
Besides KNH and Moi University, other institutions with large numbers of off-payroll staff included the Kenya Forest Service with 385 officers, the Kenya Wildlife Service with 310 and the Pyrethrum Processing Company of Kenya with 274.
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Public universities recorded the highest proportion of employees paid outside the payroll system at 3.3 percent of their workforce. They were followed by state corporations and semi-autonomous government agencies at 2.6 percent, while statutory commissions and authorities recorded 2.5 percent.
Constitutional commissions, independent offices, ministries and state departments registered the lowest share, each standing at 0.3 percent.
The report also revealed that 1,566 officers went without pay during the year under review, accounting for 0.6 percent of the workforce assessed. KNH recorded the highest number of unpaid employees at 1,135, with the commission noting that the hospital did not provide an explanation for the non-payment.
