On 20 July 2022, the Sick Leave Act 2022 was signed into law by the President providing for employer-paid statutory Sick leave. However, the start of paid Sick Leave entitlement was pending a Ministerial Order. On 12 October 2022, during a Dáil Éireann debate on Employment Rights, Tánaiste and Minister for Enterprise, Trade and Employment announced that the Sick Leave Act will commence on 1 January 2023.
The Sick Leave act introduces 3 days of statutory employer-paid Sick Leave per year, which gradually increases to 10 days per year starting 1 January 2026.
Previously, there was no mandate that an employer continues paying an employee while they were on Sick Leave. Under the provisions of the Act, employees are entitled to employer-paid statutory Sick Leave of up to 3 days in 2023. Employee entitlements will then gradually increase to 5 days starting 1 January 2024, to 7 days starting 1 January 2025; and to 10 days starting 1 January 2026.
Employees who need sick days in addition to their statutory employer-paid Sick Leave entitlement may, subject to social contributions, qualify for social security Illness Benefits.
Employer payment during Sick Leave will be 70% of the employee’s base salary, capped at EUR 110 per day, which corresponds to an annual cap of EUR 40,889.16. The capped amount can be revised by Ministerial Decree in line with changes in the cost of living.
The Act provides that exemptions can be granted in cases where an employer is experiencing severe financial difficulty.
To be entitled to employer-paid statutory Sick Leave, employees must be working for their current employer for at least 13 weeks; and have a medical certificate by a General Practitioner stating that they are unfit to work. The medical certificate should be provided only if the employee takes Sick Leave for more than 2 consecutive days. An employee on statutory Sick Leave will, for all other purposes, be treated as if they have not been absent from work.
Employers must record statutory Sick Leave taken by their employees and retain the information for a period of 4 years. The records should include all the period of employment of each employee; the dates and times of each employee’s Sick Leave; and the amount of Sick Leave payment made to each employee. Employers who fail to record and retain employees’ statutory Sick Leave information will be subject to a class C fine, which can be up to EUR 2,500.
Paid Sick Leave policies improve public health outcomes and supports employees’ overall mental wellbeing and health. Access to paid Sick Leave reduces the spread of illnesses at the workplace and increases employee loyalty and productivity, which from employers translated into employee retention.
The forthcoming changes will entail employer obligation. Employers will need to plan for statutory paid Sick Leaves in terms of budgeting, taking into account the number of days of employer-paid Sick Leave will gradually increase from 3 days per year starting 1 January 2023 to 10 days per year starting 1 January 2026; update their leave policies; and prepare related communication materials to inform their employees of their new entitlements. Additionally, employers must develop record keeping processes for employees’ statutory Sick Leave.
Reprinted with permission from the Alliant Insurance Services, Global Practice.
