Previously, Irish workers received no legal right to pay whilst off work sick. This all changed in July 2022, with the introduction of the Sick Pay Act 2022. This new legislation now affords greater rights and protections to employees and helps safeguard their earnings even during times of unavoidable absence such as prolonged illness.
Compliance with this new legislation will be a number one priority for businesses across Ireland as we move into the new year. There are a number of legal and financial pitfalls which always go hand in hand with rules around pay and organisations and their payroll teams will want to understand how they can put their best foot forward in meeting these changes.
So what do the new Statutory Sick Pay rules mean for your organisation and what do you need to know in order to be ready for the change?
What is the Sick Pay Act 2022?
The Sick Pay Act represents an unprecedented change in the protection of worker’s salaries across Ireland, guaranteeing them a form of income even when unfortunate absence arises as a result of sickness.
Where there were previously no legal obligations for organisations to provide statutory sick pay, from next year the rules are changing. Employees can now expect:
- Paid sick leave for up to 3 sick days per year. This will increase to 5 days in 2024, 7 days in 2025 and 10 days in 2026.
- A rate of payment for statutory sick leave of 70% of normal wages to be paid by employers (up to a maximum €110 per day).
- Take a complaint to the WRC where they are not provided with a company sick pay scheme.
When does the new rule come into effect?
Despite the Act being passed in July 2022, the new rules actually come into full effect from the 1st January 2023 when the new law commences.
Which employees qualify for SSP?
To be entitled to paid sick leave under the new scheme, you must be working for your employer for at least 13 weeks. You will also need to be certified by a GP as unfit to work. Organisations may still ask for further medical certification during or after the period in which they have been absent.
Employees who are unsure if they qualify for SSP are encouraged to ask their employer directly or reference their contract of employment, which should state their entitlement clearly. Although The Sick Pay Act has introduced a legal obligation for employers to provide sick pay, an organisation may still limit or set out terms by which sick pay may be given, for example, stating that you must contact a specific party within your organisation to make them aware of unavailability or by setting a cap on how much sick pay may be earned in a certain period.
SSP, Annual Leave and Public Holidays.
If a sickness absence falls on a public holiday, the rules are largely at the discretion of your employer. Some may choose not to acknowledge you being off sick on that day, choosing instead to pay you at your standard rate.
If you work part-time and you are on sick leave during a public holiday, you are entitled to time off work for the public holiday provided you worked for your employer at least 40 hours in total over the previous 5-week period.
You are not entitled to pay or time off for the public holiday if you are on sick leave immediately before the public holiday, and either of the following apply:
You have been off work for more than 26 weeks due to an ordinary illness or an accident.
You have been off work for more than 52 weeks due to an occupational accident.
For your annual leave, if sickness occurs during this period and you are able to provide medical certification, these sick days should not be counted against your allocation of annual leave days. As long as you are able to provide medical certification, an employer has no legal authority to demand you count sick days as annual leave.
You can continue to accrue annual leave entitlement while you are off sick, as long as you have a medical certificate. If you are on long-term sick leave and cannot take your annual leave due to illness, you can carry it over for up to 15 months after the end of the year it was earned. If you leave your job within these 15 months, you should get payment instead of the leave you did not take due to illness.
How can businesses prepare?
Any significant changes in legislation can present a number of challenges for organisations. With pay, in particular, the legal and financial penalties posed by noncompliance are unacceptable, meaning that businesses need to meet these changes head-on.
A cornerstone of the new act will be ensuring that you have an effective absence management policy in place, along with a time and attendance and absence management system which helps you capture accurate data around leave. Having the correct overview of this information means you can feed it directly into your pay function, ensuring accurate pay for your absent employees.
Another key responsibility will be communicating the new rights and allowances to your people. If your organisation is setting out conditions that must be met to earn SSP, then it is vital that these are communicated clearly to employees. Your HR systems should offer the perfect platform for you to push out company-wide updates around new legislation, regardless of where your people are choosing to work from.
Want to learn more?
If you’d like to find out more about what these changes in legislation mean for your business or would simply like a chat about how to best navigate through the challenges of SSP, self-certification and absence management, our team of friendly experts are always on hand- Get in touch today.