Ireland publishes draft statutory paid sick leave legislation

The Sick Leave Bill (12 page / 240KB PDF) will, for the first time, provide employees with a statutory entitlement to a minimum period of paid sick leave from their employer, if they fall ill or sustain an injury which prevents them from being able to work.

The bill follows the Department of Enterprise, Trade and Employment’s announcement in June that the Irish government had approved plans to establish a statutory sick pay (SSP) scheme from 2022. The scheme is set to be rolled out through four phases, with an initial introduction of three days’ sick pay from 2022, eventually extending to 10 days’ sick pay in 2025. This staggered increase is intended to allow employers to adapt, plan and budget for the shift in their employees’ rights.

Employee entitlement and eligibility for the SSP scheme

As currently drafted, the bill provides that employees with 13 weeks’ continuous service will be entitled to a sick leave payment from their employer for up to three days of certified sick leave per year.

The minister for enterprise, trade and employment will have the power to vary the number of statutory sick days. However, the bill prohibits the minister from reducing the number of statutory sick days below three days per year and from increasing the number of statutory sick days by more than three days per year. In addition, any orders to vary the number of days must be at least 12 months apart.

SSP scheme payments available to employees

The rate of pay that is to be paid by the employer under the SSP is not yet known as it is to be determined by the minister in separate regulations.

Non-application of employer obligations and exemptions available

The obligations under the bill will not apply to an employer that already provides its employees with a sick leave scheme where the terms of that scheme confer, over the course of a reference period set out in the scheme, benefits that are, as a whole, more favourable to the employee.

In determining whether a scheme is more favourable than the SSP scheme, the following will be taken into consideration:

• the period of service of an employee that is required before sick leave is payable;
• the number of days that 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.

The bill also provides that an employer can apply to the Labour Court for an exemption from paying statutory sick pay due to financial difficulties. If granted, the exemption will be provided for a minimum of three months and a maximum of one year.

The Labour Court will have to consider:

• whether the employer has informed the employees concerned of the financial difficulties of the business, and has attempted to come to an agreement with the employees, their representatives or trade union in relation to a proposed exemption from payment or statutory sick leave payment; and
• whether the employer is unable to pay statutory sick pay to the employees, due to the employer not having the ability to pay or being unlikely to be able to pay, to the extent that, if the employer were compelled to pay, there would be a substantial risk that a material number of employees would be likely to be laid off, or made redundant, or that the sustainability of the employer’s business would be significantly adversely affected.

While the possibility of applying for an exemption will be welcomed by employers, based on the criteria only a small number of employers would be eligible for an exemption granted by the Labour Court.

Employees on probation

Employees on probation are also accounted for under the bill. Where an employee who is on their probation period, is undergoing training in relation to their employment, or is employed under a contract of apprenticeship takes statutory sick leave; and their employer considers the employee’s absence to be inconsistent with the continuance of the probation, training or apprenticeship, then the employer may require that the probation, training or apprenticeship be suspended during the period of statutory sick leave and then completed by the employee at the end of that period.

Increased employee protections

The bill also provides increased protections for employees. An employee who is absent on statutory sick leave should be treated as if they have not been absent, and such absences should not affect any right related to the employee’s employment whether conferred by statute, contract or otherwise.

The bill further provides that an employee should not be penalised for exercising or proposing to exercise their statutory sick leave entitlement.

This means that there will be a greater obligation on employers to ensure that employees are not being treated differently for taking statutory sick leave. This obligation is likely to have more of an impact as the statutory sick leave entitlement increases.

Records

Employers will be required to keep a records of statutory sick leave taken by each employee for 4 years and failure to do so in an offence, liable to a fine on summary conviction of up to €2,500.

Redress

It is proposed that an employee will be able to make a complaint to the Workplace Relations Commission if an employer does not abide by the statutory sick leave entitlements.

Under the current draft bill, if an employee is successful in such a claim an adjudication officer may award compensation in an amount that the adjudication officer considers ‘just and equitable having regard to all circumstances’. However, this amount cannot exceed 20 weeks’ remuneration.

An adjudication officer’s decision can be appealed to the Labour Court, where again the maximum compensation cannot exceed 20 weeks’ remuneration.

The Sick Leave Bill is likely to have a big impact on employers who currently do not provide sick pay. Employers should keep their current contracts and policies under review, in the expectation of further developments as the draft bill makes its journey through the Dáil and Seanad.

Co-written by Jason McMenanim of Pinsent Masons, the law firm behind Out-Law