THE SICK LEAVE ACT 2022

The Sick Leave Act 2022 became law on the 20^th of July 2022 and has now commenced.  The provisions of the Act are to be phased in over a four-year period and the Employees Sick Pay entitlement will start once the law is commenced. The scheme will commence with three days per year rising to five days payable in 2023 and, seven days payable in 2024.  It will be the latest in a series of actions that have improved social protections for workers and the self-employed over the last five years, including:

• • paternity benefit
  • parental leave benefit
  • enhanced maternity benefit
  • treatment benefit
  • the extension of social insurance benefits to the self-employed

Main provisions of the Act:

• • 70% of an employees wage, subject to a daily threshold of €110. This may be revised over time by ministerial order in line with inflation and changing incomes.  The rate of 70% and the daily cap are set to ensure excessive costs are not placed solely on employers, who in certain sectors may also have to deal with the cost of replacing staff who are out sick at short notice.
  • Employees must have a minimum of six months service with the employer to be eligible to receive statutory sick pay.
  • It applies to both fixed term and part time employees.
  • The employee must be medically certified as unfit to work. The Employer must deduct taxes in the normal manner.  Once the entitlement to statutory sick pay from the employer ends, employees who need to take more time off may qualify for illness benefit from the Department of Social Protection subject to PRSI contributions.
  • Employers should be aware that the draft legislation will not erode existing contractual rights where an employee’s current contractual entitlement to sick pay exceeds the amount of paid sick leave envisaged by the draft legislation.
  • The Act does not provide for any further top up of salary for the employee and nor will any compensation scheme be provided for employers to assist them with the costs of sick pay.

It is envisaged that Employers will eventually cover the cost of 10 sick days per year in 2025. The Legislation is being phased in to help employers, particularly small businesses, to plan ahead and manage the additional cost, which has been capped.  Therefore, businesses around the country must now make provision for this new regime and consider where changes to existing policies are required once the scheme is introduced. The right to sick pay will be legally enforceable by employees through the Workplace Relations Commission and the Courts and will be another arsenal in an Employees complaint against an Employer.  If you are an employer who is concerned about issues surrounding Sick Pay policies and need to review your employment contracts, contact our Employment Law Expert Anthony Shields by telephone on 021 239 0620 or by email: Anthony.shields@mdmsolictiors.ie