New sick leave bill 2021 – An overview

Under the proposed Sick Leave Bill 2021, employees will be entitled to three days per annum paid sick leave from next year, effectively filling the gap in coverage caused by Illness Benefit waiting days.

All workers are to get a right to be paid for up to ten days of sick leave per year by 2025, under plans agreed by the Government today.

The new scheme is to be phased in over the next four years to give employers time to plan ahead for the extra costs.

That will rise to five days in 2023 and then seven days in 2024, before reaching the maximum of ten days each year in 2025.

Employers will have to make the payments at 70% of an employee’s wage, a rate the Government said should not place an excessive burden on employers who have to backfill for sick staff.

A daily threshold of €110 will apply, which is based on 2019 mean weekly earnings of €786.33 or an annual salary of €40,889.16.

An impact analysis carried out by the State estimates this to be equivalent to a 2.6% pay increase in terms of value to the average employee who currently receives no sick pay from their employer. 

It will be possible for the Government to vary this amount to keep it aligned with inflation and incomes using a ministerial order.

According to the Government, the bill will provide a minimum level of protection to low paid employees without an entitlement to company sick pay schemes.

But the new laws will clearly state that this does not prevent employers from offering better terms or unions negotiating for more.

To avail of the scheme, an employee will have to get a medical cert and will have to have worked for their employer for at least the previous six months.

After the employer sick pay period ends, if further time off is required the employee may qualify for illness benefit from the Department of Social Protection.

It’s hoped the bill would be enacted before the end of the year and that the scheme would begin from 1 January 2022.

The new scheme will apply to all employees in all workplaces, with no exceptions, provided the employee is at least six months on the job.

The €110 a day threshold is a floor, not a standard, and employers can give more if they wish to.

It would also be up to individual employers as to whether they seek a doctor’s cert, but legally they would be entitled to.

If you want more advice on planning for this and preparing your employment contracts, feel free to call me, Dermot, 086 843 6361.