The government has announced that the entitlement to paid statutory sick leave will remain unchanged at five days per calendar year, a move which has been welcomed by many of the business employer groups and organisations in this country.
Under the Sick Leave Act 2022, statutory sick leave was introduced on 1 January 2023; the entitlement was initially set at three days per calendar year, moving to five days from 1 January 2024. However, it will now remain unchanged, as opposed to moving to the proposed seven days of sick leave per calendar year.
On making the announcement, Minister for Enterprise, Tourism and Employment, Peter Burke TD, said that since the introduction of statutory sick leave in 2023, and subsequently the increase in the sick leave entitlement to five days in 2024, business owners and representative organisations, particularly in the retail and hospitality sectors, have consistently raised concerns about the cumulative impact of such regulatory measures, in light of rising labour, input and energy costs.
“Five days’ sick leave strikes the right balance. It gives workers income protection for five days, after which illness benefits are there to support them,” the Minister pointed out. Once an employee has exhausted their entitlement to employer-paid sick leave, they then move onto illness benefit, operated by the Department of Social Protection, if eligible.
Paid sick leave ensures that employees are entitled to a minimum level of financial compensation if they are unable to work due to illness or injury. Workers will be entitled to up to 5 days of sick leave in a calendar year, paid at 70% of gross earnings, up to a daily cap of €110. The goal of the legislation is to provide a level of financial protection to employees, often in low-paid, precarious roles, who are genuinely unfit to work due to illness or injury but who do not have access to a company sick leave scheme. The illness benefit scheme operated by the Department of Social Protection remains available to eligible employees once they have exhausted their entitlement to employer-paid sick leave.
Research by the Government’s Economic and Evaluation Service and the Department of Enterprise, Trade and Employment on sick leave in Ireland found that firms in the retail, accommodation and food services sectors are likely to be more affected should the statutory sick leave entitlement increase from five day to seven days.
Separately, the Department of Enterprise, Trade and Employment is currently working on an analysis of closures in the hospitality sector, which is being completed as a matter of priority.
Chambers Ireland has supported the Government’s decision to refrain from introducing additional statutory sick pay measures, a move that it claims would have placed another burden on employers at a time when they are already grappling with rising costs, increased regulatory requirements and a period of unprecedented global uncertain and unpredictability.
Chief Executive Ian Talbot stated, “We appreciate the Government’s recognition of the challenges faced by businesses in the current economic climate. The decision not to introduce additional statutory sick pay measures is a welcome relief for employers who are striving to manage their operations amidst escalating costs, increases in the minimum wage and a series of other new legislative requirements implemented in recent years. This will allow businesses to focus on maintaining their workforce and sustaining their operations during these uncertain times.”
Talbot continued, “Ensuring that employers are not overburdened with additional obligations is vital for the stability and growth of our economy.” In addition to welcoming the decision on statutory sick pay, he acknowledged that businesses are preparing for the implementation of auto-enrolment.
“Auto-enrolment is a significant step forward in improving retirement savings for employees. While it presents its own set of challenges, we are committed to working with businesses to ensure a smooth transition and compliance with the new requirements”.
