This week, on 20th July, the Sick Leave Bill 2022 became law. Once the law is commenced, employees in Ireland will be entitled to sick pay. The Irish Government first produced a draft to introduce a new Sick Leave Bill back in November last year. An Tánaiste, Leo Varadkar, announced in March 2022, that the Sick Leave Bill was approved by cabinet and will legislate for a statutory sick pay scheme for all employees, which will be phased in over a four-year period. Before the law was passed, Ireland was one of the few countries in Europe who were without mandatory sick leave entitlement. Before the Sick Leave Act, only about half of all employers had their own sick pay scheme. The Covid-19 pandemic helped to highlight the need for such a scheme to be introduced into Ireland.
When the law is commenced, which is expected to happen shortly, employees will be entitled to three statutory sick days. This will rise to five days in 2024, seven days in 2025 and to ten days in 2026. Employers will pay employees at a rate of 70% of an employees’ wage, subject to a daily maximum threshold of €110. These earnings are based on 2019 mean weekly earnings of €786.33 and an annual salary of €40,889.16.
The rate of 70% and the daily cap are there to ensure excessive costs are not placed solely on the employer. The introduction of the new Sick Leave Bill is to provide a minimum level of protection to low paid employees, who may not be entitled to a company sick pay scheme.
If your business does not have a sick leave scheme set in place already, the new legislation being introduced will act as your sick pay scheme. Employers must keep a record of all employees who have availed of the scheme for up to four years, those who fail to keep a record may be fined up to €2,500.
To ensure that your employees are entitled to receive sick leave pay under the scheme, they must obtain a medical certificate as proof, and must have worked for their employer for a minimum of 13 weeks. If your employees’ sick pay entitlement is finished, and they need extra time off, they may be able to qualify for illness benefit from the Department of Social Protection, depending on their PRSI contribution.
The new Sick Leave Bill will help ensure employees are not penalised for missing days due to illness. Once the law is commenced, your payroll software should be updated to cater for this new employee entitlement.