Statutory Sick Pay

 

There is currently no statutory sick pay in Ireland, that is, at the moment, employees do not have a legal right to be paid whilst on sick leave.  Currently, it is at the discretion of the employer to decide on sick pay and sick leave, this is normally written into an employee’s contract or terms and conditions of employment. At the moment, about half of workers in Ireland have a sick pay scheme and the other half don’t.  

 

The government have signed off on new legislation to give all workers the right to paid sick leave.  This will be phased in over a four year period, starting with three days per annum in 2022, rising to five days payable in 2023, and seven days payable in 2024.  This new legislation was brought about following the recent pandemic and is the way forward for a more inclusive and fairer society.

 

In the long term, employers will have to cover the cost of ten sick days per annum by 2025.  This will be the minimum statutory level of sick pay a company will have to offer but it they can decide to offer more.

 

This legislation will be phased in over the coming years, so that employers can plan ahead and manage the additional cost to running a business.

 

The sick pay will be paid by the employer at a rate of 70% of an employee’s wage subject to a daily threshold of €110.  This threshold will be revised over time to keep in line with inflation and changing incomes.  The sick pay/leave must be certified by a doctor and an employee will be required to be in employment with their employer for more than six months.

 

The state will not be contributing to the sick pay scheme, in other words all of the cost will be borne by the employer.

 

If further sick leave is required, and after the sick pay from the employer ends, an employee who requires additional time off may then qualify for illness benefit from the Department of Social Protection providing they meet the qualifying criteria (PRSI contributions).

 

 

It is anticipated, that in the long term, while costs for a business may increase, overall, the higher morale and better productivity will offset the additional cost of paying an employee while they are out sick. This is because employees will not feel obliged to attend work, so productivity may increase.  Also, there is less risk of an employee passing on their illness to another employee.

 

The Tánaiste will publish an impact assessment on the Sick Leave Bill, which will set out the associated costs and benefits, along with the proposed arrangements for implementation.

 

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