In a press release delivered last week, the Tánaiste and Minister for Enterprise, Trade and Employment, Leo Varadkar TD confirmed details of the plans to introduce a statutory sick pay scheme for employees. The scheme provides for a phased introduction of statutory sick pay over a four-year period beginning in 2022.
Employees will have the following statutory entitlements over the four-year period:
3 days in 2022
5 days in 2023
7 days in 2024
10 days in 2025
The rate of sick pay will be set at 70% of the employee’s wage subject to a daily threshold of €110. This is based on 2019 mean weekly earnings of €786.33 and equates to an annual salary of €40,889.16. This threshold may be reviewed and amended over time in line with changes in income/inflation. The Tánaiste assured employers that “the scheme is designed to be fair and affordable with the minimum complexity and administrative burden for employers."
However, not all employees will be entitled to statutory sick pay. There are two conditions that an employee will have to fulfil in order to qualify for the payment.
Employees will have to:
- Provide their employer with a medical certificate, and
- Have a minimum of six months' service.
The Sick Leave Bill, which will introduce the scheme, is due to be published at the end of 2021. This means the obligation to provide the statutory sick pay will not apply to businesses until 2022.
Approximately half of employers in Ireland already provide for a sick pay entitlement. In many cases, this entitlement will exceed the new/updated statutory sick pay, in which case there will be no change for employers. However, it will be important for employers to ensure that contractual sick pay includes any applicable statutory entitlement. Employers should also consider reviewing their contracts and sick leave policies to ensure they consider the minimum statutory entitlements under the sick pay scheme when it comes into force in 2022.
The government press release on the new scheme is available here.
For more information, contact a member of our Employment & Benefits team.
The content of this article is provided for information purposes only and does not constitute legal or other advice.