The Budget 2022 contains several changes that employers and employees need to be aware of from a HR perspective. Below, we look at these HR changes:
What is the Budget 2022?
The Budget is the amount of money the Government has to spend each year, and what it decides to spend it on. On Budget Day, the Government gives a detailed breakdown of how much money it expects to collect in the year ahead (income) and how that income will be spent across all Government Departments (expenditure).
How will the Budget affect HR matters in 2022?
- Pensioners will receive an extra €5 a week while other welfare payments such as the jobseekers payment and maternity benefit will also increase by the same amount from January.
- The National Minimum wage is to be increased by 30 cents to €10.50.
- The standard rate (20%) tax band will be increased by €1,500.
- There will be an increase in each of the personal tax credits, employee tax credits, and earned income credits by €50 to €1,700.
- USC – To ensure that the salary of a full-time worker on the minimum wage will remain outside the top rates of the Universal Social Charge, the ceiling of the second USC rate band will be increased from €20,687 to €21,295.
- The EWSS will remain in place in a graduated form until 30 April 2022. There will be no change to the EWSS for October and November. Businesses availing of the EWSS on 31 Dec 2021 will continue to be supported until 30 April 2022. From Dec 2021 to Feb 2022, a two-rate structure of €151.50 and €203 will apply, while for Mar and Apr 2022, the final two months of the scheme, a flat rate subsidy of €100 will be put in place.
- Employer’s PRSI – From 1 January 2022 the weekly income threshold for the higher rate of employer’s PRSI will increase from €398 to €410.
- Working at home – Minister Donohoe announced an income tax deduction amounting to 30% of the cost of vouched expenses for heat, electricity, and broadband.
- An extra two weeks of parent’s leave to be introduced from August 2022 so that parents of a newborn can take up to seven weeks off work supported by the State.
Labour market support – a further €34 million is being allocated for apprenticeships, “which will include off-the-job training places for 7,000 apprentices impacted by Covid”.
- The Government’s ‘Pathways to Work’ strategy will be a critical element of supporting people who need help finding new jobs after Covid as well as those unemployed pre-Covid. The plan will do this through a new work placement scheme, additional places on the Community Employment and Tús employment programmes, and 20,000 new further education and training places.
Employers need to ensure they update their HR policies to reflect the changes brought about as a result of Budget 2022. If anyone has queries regarding these changes, they can contact email@example.com or visit ghrconsulting.ie