Home Knowledge The Cost of the Coronavirus – To Pay or Not to Pay?

The Cost of the Coronavirus – To Pay or Not to Pay?


On 6 April 2020, we published an updated account of the below, please click here to view.

In our recent article (available here) we outlined the key employment law concerns that are arising in connection with the ever-evolving outbreak of Covid-19 (coronavirus). As the number of identified cases continues to grow, many schools, universities and businesses are stepping up their preventative measures. But what impact do these actions have when it comes to employee pay? 

In particular, the unprecedented Covid-19 outbreak is raising difficult questions when it comes to employee pay. From a public health perspective, tackling this outbreak has resulted in school closures with working parents required to stay at home to mind children. Public transport may also be shut down preventing employees getting to work even if their workplace remains open. Employees may be required by their employer to self-isolate for 2 weeks regardless of whether they are set up to work remotely. Navigating these scenarios is a first for Irish employers and it has the potential to be a HR minefield.

Emergency legislation on the way

On 9 March 2020, the Government announced emergency legislation amending the eligibility rules for Illness Benefit for those in medically-certified self-isolation or suffering from Covid-19 which include:

  • waiving the six-day lead-in period before becoming eligible for Illness Benefit in respect of medically certified cases of self-isolation;
  • removing the means test for the Supplementary Welfare Allowance in respect of medically certified cases of self-isolation;
  • increasing Illness Benefit from €203 to €305 per week for up to two weeks of medically certified self-isolation or for the duration of a person’s medically certified absence from work due to Covid-19; and
  • providing self-employed people entitlement to either Illness Benefit or the non-means tested Supplementary Welfare Allowance.

Notwithstanding these measures, there are differing views from IBEC and ICTU and others as to whether employees (who cannot work remotely) are entitled to be paid during this outbreak. Also, the Government’s measures do not extend to employees who do not have the virus but are required by their employer, as a precautionary measure, not to come into work.

While Ireland’s approach to employee pay against the backdrop of this outbreak is evolving and should be kept under review, we have set out below some practical guidance on how to address the complex issue of pay in this unique context. 

What happens if…

…the employer shuts down, but the employee can work remotely from home? 

The employee is still working and should be paid as normal. If the employer cannot continue its business and must close permanently, the employee’s role is redundant. The employee may be entitled to statutory redundancy pay and other payments.

…the employer shuts down, but the employee cannot work from home? 

Unless such a situation is provided for in the employees’ contract or a relevant policy, where an employee is not set up to work remotely from home and the employer cannot provide them with work during a shut-down period, a temporary ‘lay-off’ situation may arise. An employer is not required to pay an employee during a period of lay-off if it is provided for in the contract of employment, it forms part of the employer’s or the relevant industry’s custom and practice or the employee agrees to the unpaid lay-off period.

An employer should facilitate any employee requests to use any accrued but untaken annual leave to cover shut-down period (in part or in full), which would be paid.

…the employee is infected with Covid-19 

An employee’s entitlement to leave and pay if infected with the virus will be addressed in an employer’s sickness absence policy. There is no statutory entitlement to be paid during a period of sick leave and any continued pay by the employer will be dictated by the employer’s sick pay policy (if any) and be subject to appropriate notification and certification. Separately, the employee may be eligible to claim Illness Benefit from the Department of Employment Affairs and Social Protection. As above, this statutory benefit is being amended via emergency legislation next week.

…the employee cannot attend work as their child’s school has been shut down temporarily? 

Where the employee can work from home, albeit while minding their child, they should continue to be paid as normal. However, where the employee is unable to work from home, the employer and employee should agree on the type of leave to be taken. For example, parental leave may be available, or an employee may opt to use his/her holidays to be paid during the period instead.

If the employee has exhausted parental leave entitlements and has no holidays to use up, the employer may agree to a period of unpaid leave.

…the employee is at home caring for a person diagnosed with Covid-19? 

An employee is entitled to leave with pay if the employee’s immediate presence is indispensable to care for a close family member. A close family member includes a child, partner, parent or grandparent, sibling, or a person to whom the employee has a duty of care or a person in a relationship of domestic dependency. 

This is known as force majeure leave. The maximum amount of force majeure leave is 3 days in any 12-month period or 5 days in a 36-month period. 

The employee may also be eligible for carer’s leave to care for a person who requires continual supervision and frequent assistance. Separately, the employee may be eligible to claim Carer’s Benefit from the Department of Employment Affairs and Social Protection.

…the employee cannot attend the workplace if public transport is shut down?

In 2018 when a snow storm resulted in public transport shutdown, the question of whether stranded employees were entitled to pay arose.  Many employers now have an Adverse Weather policy in place to clarify whether the employee will be paid in such circumstances. 

Subject to any other contractual term or policy, where the employer’s workplace remains open and the employee cannot attend work (or work remotely) due to a shut-down of public transport, the employee is not entitled to be paid. 

…the employee, returning from a business trip to an infected area, is required by their employer to self-isolate?

Generally, there is no statutory requirement to pay employees who are absent from work while self-isolating (unless they can work remotely form home).

However, if an employee has travelled to an affected area for business reasons at the behest of the employer, it is reasonable to conclude that employees required to self-isolate, even where they cannot work remotely, should continue to be paid. 

Such pay should be determined on a case-by-case basis and kept under regular review. An employer should make it clear that any such pay is for a once-off event given the unprecedented risk arising from the coronavirus and is not company policy. 

…the employee, returning from holiday to an infected, is required by their employer to self-isolate?

As above, there is no statutory requirement to pay employees who are absent from work while self-isolating (unless they can work remotely). Where such self-isolation is medically certified, the employee may be entitled to Illness Benefit from the State in line with emergency legislation due to be passed next week.

An employer may decide to continue paying the employee to reduce the risk of them “demanding” to attend work in order to continue to be paid and potentially exposing the rest of the workforce to the virus. Where an employee effectively “forces” the employee not to attend work without continued pay, the employee may look to take a claim under the Payment of Wages legislation.

As part of their risk assessment and contingency planning, prudent employers are  advised to put in place a comprehensive policy addressing employee’s holiday plans  and self-isolation requirements.

If you have any specific queries in relation to the Covid-19 virus, please get in touch with your regular William Fry contact.

Contributed by: Richard Smith




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