What’s the craic with Statutory Sick Pay in Ireland?

The year is 2021, the month is June. Olivia Rodrigo’s “Cool 4 U” is number one in the charts, we are still in the midst of a nationwide lockdown. You’re in bed sick, sipping flat 7-Up and your job doesn’t offer statutory sick pay. Things are looking bleak. But suddenly, your ears prick at an announcement on the news saying that the government plans on bringing in a national Statutory Sick Pay (SSP) scheme. A ray of light shines in the window.

Fast forward to today and you’re back in the office, lockdown is in the distant past and the Sick Leave Act 2022 has become law and will come into force early next year. Ireland was one of the only advanced economies in Europe without mandatory sick leave entitlement so this is excellent news. Before, sick leave was at the discretion of the employer.

From January next year, SSP is being phased in over a four-year period starting with three days payable per year in 2023, rising to five days payable in 2024, seven days payable in 2025 and eventually, by 2026, employees will cover the cost of 10 sick days per year. The phased introduction is to allow employers to prepare and budget for the scheme and its associated cost.

So what do employers have to do? The SSP will be paid at the rate of 70% of the employee’s wage, subject to a daily threshold of €110. The eventual 10 days, or two working weeks, will be in addition to other leave, as well as public holidays.

There are some caveats however. Employees will have to provide a medical certificate to qualify for SSP and will need to have been employed by the employer for a minimum of six months before they can claim SSP. The leave must also be in relation to a day or days when an employee would usually work but is unable to due to illness or injury. The leave can also be taken as consecutive or non-consecutive days.

“And how will this affect employers” I hear you ask? Well, if you don’t already have a sick leave scheme in place at your company the new legislation may impose costs onto you. These include administrative costs in relation to setting up and implementing the scheme, along with maintaining records.

In the records you are required to keep information on:

• The employees’ period of employment
• The dates of statutory sick leave in respect of each employee
• The rate of statutory sick leave payment in relation to each employee

Employers may also wish to update their template contracts for new hires to include that contractual sick pay is inclusive of any applicable SSP entitlement. It is also important that you examine existing policies and contracts to make sure they comply with the minimum statutory entitlement under the SSP scheme when it comes into effect. Or, if you use employee contract software like Bright Contracts, this information will be automatically updated for you.

If you already have a sick pay scheme in your company and the existing provision is as favourable or more favourable than the statutory provision, you’re good to go and no changes are needed. It’s only when the existing provision in your standard entitlement employment contract is less favourable than the statutory provision that you will then have some work to do to bring it up to speed.

So there you have it! It might seem like a bit of a headache (no pun intended) but in the long run the scheme will benefit both employers and employees alike. You don’t have to deal with Margaret coming into work and coughing all over you, spreading germs. Plus, employees will feel more protected and valued when they can recover in the safety of their own bed with a hot water bottle and a good ol’ Netflix subscription.

Written by Aoibheann Byrne | BrightPay Payroll Software

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Posted byAoibheann ByrneinSick Leave/Absence Management