Aug 2021


Sick pay comes to Ireland: How does this affect employers and payroll processors?

In Ireland, employers currently do not have any legal obligation to pay employees who are absent from work due to illness. In the private sector, it is at the discretion of the employer as to whether or not they decide to pay employees who are unable to work due to sickness.

A survey from 2019 found that only 44% of employers offered their employees some form of paid sick leave. For employees working in the public sector, The Public Sector Sick Leave Scheme was introduced in 2014. Under the scheme, public sector employees are entitled to 7 days paid sick leave within a continuous 2-year period, without having to submit a medical certificate. When a medical certificate is provided, employees are entitled to 92 calendar days of fully paid sick leave followed by 91 calendar days on half pay, subject to a maximum of 183 calendar days in a rolling 4-year period.

The effects of the COVID-19 pandemic shone a light on the need for statutory sick pay to be introduced into the private sector. Having no sick pay entitlements meant that employees were more likely to attend work, despite experiencing symptoms of COVID-19, risking passing on the virus to colleagues. Employees who were working from home also took fewer sick days during the pandemic as because they did not have to leave their homes they continued to work, despite feeling unwell. Both of these situations can be damaging to an employee’s health.

How does offering sick pay benefit employers?

When there is no sick pay scheme in place, many employees will attend work while unwell as they do not want to miss out on pay. This does not benefit either the employer or the employee. If the employee is trying to work while they are sick, they are not going to be able to be as productive as they usually would be. This could also lengthen the time it takes for them to recover from the illness and they may not be able to work to their full potential for a lot longer than it would have been if they had taken the time off needed to recuperate.

Offering employees sick pay leave can actually help reduce the number of sick days taken by employees overall. As well as getting better faster, If the employee does not come into the workplace sick, they won't spread the sickness to other employees.

What sick pay is being introduced?

Statutory entitlement to sick pay will be phased in as part of a 4-year plan beginning in January 2022 and will be paid by employers at a rate of 70% of an employee’s wage, subject to a daily threshold of €110. The table below shows how the number of sick days covered by employers will rise over the four years.

How does the introduction of statutory sick pay affect payroll?

Payroll processors may be wondering how the introduction of statutory sick pay in Ireland will affect how they calculate pay for employees who have taken sick leave. Within BrightPay payroll software, at the moment, if an employer offers paid sick leave to their employees, payroll processors can add sick pay as an ‘addition type’ within the payroll software. The employer can then manually add the amount of sick pay owed to the employee when entering the employee’s pay information for that period. The employer can add sick days taken to the employee’s calendar and choose whether these days were certified or uncertified. The days where sick leave have been taken will be colour-coded and the total number of sick days taken will be displayed on the bottom right-hand side of the screen. This means that you can clearly track the number of sick days taken by each employee.

Through our optional cloud add-on, BrightPay Connect, employees can access an online portal through an internet browser or through the BrightPay Connect mobile app. Any days taken as sick leave will be highlighted meaning that the employee can keep track of how many sick days they have taken so far that year.

At BrightPay, through the UK version of our software, we have experience with applying sick leave entitlements to employee’s pay since 2012. Having this experience means we are well prepared to make any changes to the Irish version of our software that will make calculating and tracking an employee’s Statutory Sick Pay entitlements as easy as possible for payroll processors.

To learn more about BrightPay’s features, book a free online demo today.

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Posted byElaine CarrollinEmployment LawPayrollSick Leave/Absence Management