Home Knowledge Introduction of Statutory Sick Pay in 2021 – What Employers Need to Know

Introduction of Statutory Sick Pay in 2021 - What Employers Need to Know

The government has committed to bringing statutory sick pay into law by the end of 2021. This will be a major change for Irish employers.  The government has launched a consultation process with stakeholders, and submissions must be made by 18 December 2020.

Unlike most other European countries, currently in Ireland employers are not obliged to pay employees while they are on sick leave.  In Ireland it is left to employers to decide whether they will include paid sick leave as part of their own policies. Where employers do provide paid sick leave, the duration of the pay and the rate of pay is decided solely by the employer. Employees in Ireland may be entitled to State benefits such as Illness Benefit (€203 per week currently) or COVID-19 Illness Benefit (up to €350 per week) where they have the requisite social insurance contributions, but these payments would typically be much less than an employee’s weekly pay. 

COVID-19 has played a large part in bolstering the argument for statutory sick pay.  Ireland’s current lack of statutory sick pay has been criticised by the NPHET because of its possible impact on the spread of COVID-19; the suggestion is that employees with COVID-19 symptoms were disincentivised from taking sick leave due to the corresponding repercussions on their pay.

The Sick Leave and Parental Leave (COVID-19) Bill 2020 (Bill) was introduced as a private members Bill before the Dáil in September 2020.  It provides that once an employee has four weeks’ service with his/her employer, he/she will be entitled to sick pay, paid at the employee’s normal weekly rate of pay, from the first day of illness for a continuous period of 6 weeks, or up to 30 days in any 12 month period.  As the Bill is a private members bill (initiated by a non-government party), it cannot pass without government support.  While the government has confirmed its commitment to reform and improve Ireland’s statutory sick pay laws, it remains to be seen whether it will support the Bill or introduce its own bill. 

A 2019 survey found that only 44% of Irish employers provided any form of paid sick leave. The passing of legislation requiring compulsory paid sick leave will result in potentially significant costs to the majority of employers not offering such a benefit, and indeed to those many employers whose policies may not be as generous as that required by legislation.  Employers will need to keep abreast of any developments in this area so that they can ensure that their employment policies and employment contracts are updated accordingly. Employers should consider planning ahead by calculating their potential monetary exposure based on average employee absences in prior years. 



Contributed by Therese Chambers