by Anne Lyne , Catherine Jane O'Rourke April-01-2022 in Commercial & Business, Corporate, Employment Law
The Irish Government recently published the draft Statutory Sick Leave Bill 2021 (the “Bill”) which was approved by Cabinet on 30 March 2022. It provides for minimum statutory sick pay (SSP) for all employees, if they are incapable of working due to illness or injury.
Who is eligible?
In order to qualify for the SSP, a person must:
- Be an employee (including apprentices and agency workers)
- Have 13 weeks’ continuous service
- Have a medical certificate signed by a registered medical practitioner which states that they are unable to attend work
How many sick days is an employee entitled to?
Up to 3 days paid sick leave per year, taken together or separately. The Bill directs that the Minister (Minister for Enterprise, Trade and Employment, Leo Varadkar) may vary the minimum number of statutory sick leave days with regard to a number of considerations outlined in the legislation, such as, the state of the economy generally and data on earnings and labour costs. The Minister has set out that the sick pay scheme is to be incrementally phased in over a four-year period, starting with three days per year in 2022, increasing to five days by 2023, seven days by 2024 and ten days by 2025.
How much will an employee be paid if they are on statutory sick leave?
The SSP will initially be paid at 70% of the employee’s regular earnings, up to a maximum of €110 per day. This rate and daily cap are to negate excessive costs being placed solely on employers.
Once the SSP Scheme has been exhausted, an employee may qualify for Illness Benefit and can apply to the Department of Social Protection within 6 weeks of becoming ill. Whether a person is entitled to Illness Benefit will depend on whether they have sufficient PRSI contributions.
How is the SSP calculated?
This will depend on whether an employee’s wages vary or don’t vary (which could be due to a variable rate of pay or variable hours each week, for example). If an employee’s pay doesn’t vary, the SSP will be easily calculated, as it will be 70% of their usual pay per day. If an employee’s pay varies, the average weekly rate will be calculated over the 4 week period immediately preceding the day of sick leave. Then, 70% of the daily rate will be calculated from that figure. This way, the Bill intends to ensure that part-time employees or employees who work irregular shift patterns will receive an appropriate rate of compensation when availing of sick lea
Can I pay more than the SSP?
While the Bill provides for a minimum standard of entitlement, nothing shall prevent an employer from including in a contract of employment a provision that is more favourable to an employee than the statutory SSP. This also applies to Trade Unions when negotiating collective agreements. However, if a provision in a contract of employment is less favourable than what the Bill provides, it will have to be modified so as to meet the statutory level.
Protection of Employment Rights
The Bill provides protections for employees, as follows:
- It protects them from penalisation or the threat of penalisation by their employer in exercising their right to statutory sick leave. Penalisation could be any act or omission by the employer that is to the detriment of an employee, including but not limited to, demotion, dismissal, or a transfer of duties.
- The Bill also provides that an employee’s period of statutory sick leave should be treated as if that employee had not been absent, so as not to impact any right related to the employee’s employment. This is consistent with other types of existing leave such as maternity leave or parents leave.
- Statutory sick leave shall not be treated as part of any other leave from employment to which an employee is entitled, including annual leave, maternity leave, additional maternity leave, adoptive leave, additional adoptive leave, paternity leave and parent’s leave.
The Bill does allow an employer to suspend a contract however, during a statutory sick leave period, in the case of an employee on probation, a trainee during their traineeship or an apprentice during their apprenticeship.
What if an employer can’t afford to pay the SSP?
Where an employer is unable to pay the SSP, it may apply to the Labour Court for an exemption which may last for a period not exceeding one year and not less than three months. In such instances, the Labour Court will seek an agreement between the employer and their employees providing consent for the exemption. However, the Labour Court may provide an exemption without consent if satisfied that the employer has adequately informed its employees of its financial difficulties.
Obligation to keep records
The Bill provides that employers are obliged to keep proper records for each employee. These records must be maintained for four years, and they must include information in relation to each employee who has taken sick leave. The following information must be included in the records kept by the employer:
- The employee’s 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 who fail to maintain sufficient records may be convicted and subject to a fine of up to €2,500.
Redress for employees
The Bill allows for an employee to seek redress through the Workplace Relations Commission where they believe their employer has failed to comply with the legislation. In such cases, the employee may be awarded up to 20 weeks’ remuneration in compensation.
Conclusion
The legislation fills a gap in the market that was identified during Covid where lower paid employees that continued to work in person during the pandemic were not entitled to sick pay and is seen as a public policy measure to seek to level up inequality in the workplace. Employers should now look to reviewing work contracts and policies and ensure any necessary budgeting for this significant change to sick leave procedures.
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About the Authors
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Anne Lyne
Anne is a partner in the Employment team at Hayes solicitors. She has considerable experience advising and representing employers and employees on all aspects of the employment relationship from pre-employment matters to termination.
Catherine Jane O'Rourke
Catherine advises both employers and employees, in relation to contentious and non-contentious employment matters, including contracts of employment, workplace policies, workplace investigations, statutory compliance, redundancies and dismissals. Catherine also has a background in transactional banking, including acquisition finance, property investment finance and development/construction finance.