Background

Prior to the Sick Leave Act 2022 (Act), Ireland was one of the few European countries without a statutory mandatory employer sick pay scheme. While many employers have provided sick pay to their staff, this is not always the case for lower-salaried workers. However, with the signing of the Act into law by the President last month, all employees (both fulltime and parttime) now have an entitlement to statutory sick leave and pay for situations where they would ordinarily work but are incapable of doing so due to illness or injury.

Sick Leave Act 2022

The Act provides for statutory sick leave payment (SSP) for an employee, subject to certain conditions, in respect of a day which they would ordinarily work but are incapable of doing so due to illness or injury, of up to three statutory sick leave days a year. An employee is entitled to SSP from their employer in respect of each statutory sick leave day. Statutory sick leave days may be taken consecutively or non-consecutively. An employee will have to provide a medical certificate from a registered medical practitioner stating that they are unable to work. An employee does not become entitled to statutory sick leave days until they have completed 13 weeks of continuous service with their employer. Once the entitlement to SSP from the employer ends, the employee may qualify for illness benefit from the State.

The Act will not apply to employers who provide more favourable sick leave/pay schemes to their employees. This will be determined by reference to:-

  • the period of service that is required before sick leave is payable;
  • the number of days that an employee is absent before sick leave is payable;
  • the period for which sick leave is payable;
  • the amount of sick leave that is payable;
  • the reference period of the sick leave scheme.

SSP and Employer Exemptions

Employees shall be entitled to a daily rate of payment as prescribed under the Act in respect of statutory sick leave. Under the Act, SSP will be paid at 70% of regular earnings up to €110 per day. This rate can be varied by ministerial order in the future to align with inflation and changing incomes.

Employers who genuinely cannot afford to pay the SSP or who are experiencing financial difficulties can apply to the Labour Court for an exemption from paying SSP for a period of between 3 and 12 months. The Labour Court requires an agreement between the employer and their employees consenting to the exemption sought. Failing this, the Labour Court may still grant an exemption if satisfied that the employer has informed its employees of its financial difficulties and attempted to reach an agreement, and that if the employer was compelled to pay SSP the viability of the business would be adversely affected, or likely lead to a material number of employees being laid-off or made redundant.

Future Amendments

Subject to certain conditions, provided 12 months has passed since the commencement of the Act, and at 12-month intervals after that, the relevant Minister is entitled to specify additional sick leave days under the Act having regard to:-

  • the state of the economy generally, the business environment and national competitiveness;
  • the state of society generally, the public interest and employee well-being;
  • the potential impact, including the potential for any disproportionate or other adverse impact, that the making of an order will have on the economy generally, specific sectors of the economy, employers or employees;
  • annual and quarterly data on earnings and labour costs as published by the Central Statistics Office;
  • expert opinion, research, national or international reports relating to the matters specified at paragraphs (a) to (d) that the Ministers considers relevant;
  • the views of employer representative bodies and trade unions; and
  • such other matters as the Minister considers relevant.

However, the Minister cannot reduce the number of statutory sick leave days below three, or increase by more than three, the number of days accounted for in the previous Order.

The Department of Enterprise, Trade and Employment has indicated plans to increase statutory sick leave days as follows:

  • Year 2: 5 days covered
  • Year 3: 7 days covered
  • Year 4: 10 days covered.

Employees on probation

Where an employee is (a) on probation, (b) is undergoing training in relation to that employment or(c) is employed under a contract of apprenticeship and that employee takes statutory sick leave, the employer may require that the probation, training or apprenticeship be suspended during the period of statutory sick leave. This applies in circumstances where the employer considers that the employee's absence would not be consistent with the continuance of the probation, training or apprenticeship.

Compliance and record retention

Where an employee believes that his or her employer has failed to comply with the provisions of the Act, the employee may make a complaint to the WRC. An employee who makes such a complaint may be awarded up to 4 weeks' remuneration if successful.

Employers are required to keep a record of the statutory sick leave taken by each of their employees and this record must be retained by the employer for a period of 4 years. Failure to comply with this record-keeping requirement could result in a fine of up to €2,500.

What happens next?

While signed into law, the provisions of the Act have yet to come into force. A statutory commencement order is necessary to bring the Act into practical operation. The implementation of this commencement order is expected shortly.

Employers are advised to proceed with introducing a sick pay policy to mitigate risks and prepare for the commencement of the Act. Those employers with a sick pay policy already in place should undertake a review of their employee handbooks and contracts to ensure that they align with the Act.

See Sick Leave Act 2022 here.