Statutory Sick Pay: What Irish Employers Need to Know and do Now

A new year and new obligations for employers to adhere to, this time in the form of an increase to sick leave entitlement under the Statutory Sick Pay (SSP) scheme.

Just one of several new 2024 obligations employers must be mindful of, SSP requires employers’ immediate attention to remain complaint. 

With that in mind, this article looks at the Statutory Sick Pay (SSP) scheme, new entitlements, and what employers must do now. 

 

On January 1st, 2024, the entitlement to paid sick leave will increase from three to five days. This increase is in line with the government’s commitment (Sick Leave At 2022) to gradually increase the entitlement until 2026, when it will reach 10 days. The increases are as follows: 

• 2024: Five days covered
• 2025: Seven days covered
• 2026: 10 days covered

Speaking about the Statutory Sick Pay (SSP) scheme in Ireland, Minister of State for Business, Employment and Retail, Neale Richmond TD said: “We do not want workers to feel that they must attend work when they are sick due to financial fears. Paid sick leave is an important workers’ right which provides protection to employees who are genuinely unable to work due to ill health or injury. Lower paid workers who cannot afford to miss work when sick stand to benefit the most from this increase to five days paid sick leave.”

 

So, what is the illness payment in Ireland and do employers in Ireland have to pay sick pay?

From January 1st, 2024, employees become entitled to five days of sick leave in a year, they will receive 70% of their gross earnings, up to a cap of €110.

To qualify for statutory sick pay in Ireland, a person must:

• Be an employee.
• Have worked for their employer for at least 13 continuous weeks before taking ill.
• Be certified by a GP as unable to work.

An employee can get sick pay if they are:

• On probation.
• Undergoing training (interns).
• An apprentice.
• An agency worker.

The SSP scheme applies to both full-time and part-time employees. However, the amount they get paid is based on the average of their pay over the 13 weeks before they began sick leave. This also applies if a person has more than one employer. Once they have completed 13 continuous weeks work for an employer, they’re entitled to five days of statutory sick leave.

 

The Statutory Sick Pay (SSP) scheme is one of several new considerations for employers to align with in 2024. For instance, employers must now remember their obligations in relation to:

• Statutory Sick Pay (SSP)
• Enhanced Reporting Requirements
• Gender Pay Gap Reporting
• The increase to the minimum wage
• Pension auto-enrolment (due 2024)

Related article: [GUIDE] Payroll Compliance: How to Avoid Breaches

What SSP means for employers is that there may be some costs to account for. These costs may include administrative costs, such as maintaining records for each employee. There are, however, benefits to employers, too. Reduced presenteeism is one as employees will no longer feel under pressure to show up for work despite being ill. Similarly, employers will be able to better manage absenteeism.

Other benefits include reduced employee turnover and better staff morale. SSP will allow those who suffer from injury or illnesses to place their recovery first and come back to work when they’re able to.  

With regards to maintaining records, these must be kept on all employees for four years and include information in relation to those staff who availed of sick leave. When maintaining records, include the following information:

• The employee’s period of employment.
• The employee’s dates of statutory sick leave.
• The employee’s rate of statutory sick leave payment.

If an employer fails to maintain accurate records, a conviction and fine of up to €2,500 could follow. In certain circumstances, an employer whose business is experiencing severe financial difficulties may apply to the Labour Court for an exemption to pay sick leave. If an employer receives an exemption, it will be for a minimum of three months, up to one year.

Related article: National Living Wage in Ireland: What Employers Need to Know

 

Many employers will already provide paid sick leave through their employment contract. Still, as the entitlement is increasing, you will need to review these contracts and update them.

If you have a dedicated HR manager or team, you need to review the Sick Leave Act and see how it relates to your business. The Act states that if an existing provision for paid sick leave in an employment contract is as favourable or more favourable than the statutory provision, the employer’s obligation under the legislation is met. The Act goes on to say that any such provision must be a “substitution for, and not in addition to” the entitlement. However, if the sick leave entitlement in your employment contract is less favourable than the entitlement provided under the legislation, it will be “deemed to be so modified so as to be not less favourable”.

To summarise, if you provide sick leave to employees that is more favourable than the terms of the SSP scheme, you won’t have extra obligations under the Sick Leave Act. To determine if your existing sick pay scheme is more favourable than the proposed statutory provisions, check if you adhere to the following criteria:

• The period of service of an employee required before sick leave is payable.
• The number of days 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.

With all these extra obligations, it’s only natural that you may look at ways to reduce your workload where possible. One such area may be payroll. 

 

At SD Worx, formerly Intelligo, we know that employers have a lot to balance these days. That’s why we offer payroll solutions such as MegaPay Outsourced. 

Developed and managed by payroll specialists, MegaPay Outsourced is guaranteed to pay your staff on time, every time. Not only that, but MegaPay Outsourced can collate monthly and annual reports and cover unexpected costs like covering the payroll function during holidays, illness, or maternity leave. It also comes with the option of a company-branded employee helpline for your employees to call with payroll queries.

So, what are you waiting for? To trial the benefits of MegaPay Outsourced for yourself, book a demo today.