The Sick Leave Act 2022, effective since January 1, 2023, grants statutory sick pay (SSP) rights to employees in Ireland for the first time. To qualify, an employee needs 13 weeks of continuous service, and they can receive up to three days of SSP per year, paid at 70% of their salary, up to a maximum of €110 per day.
The Act allows for employers to have sick pay provisions that are as good as or better than SSP, and such provisions replace SSP. If a sick pay scheme offered by an employer is more advantageous to the employee over a specific period, the obligations for SSP do not apply. However, this situation created some confusion for employers regarding the extent of “more favorable” sick pay needed to be.
WRC CASE
A recent case was brought to the WRC, Katerina Leszczynska v Musgrave Operating Partners, the claimant, a shop assistant, was absent for four consecutive days in 2023 and believed she was entitled to SSP for the first three days. However, her employer’s sick pay scheme considered the first three days as “waiting days” and were unpaid. The claimant contended that this was less favorable than SSP, while the employer claimed its scheme was more favorable.
The case hinged on the Act’s criteria for determining the overall favourability of a company’s sick pay scheme compared to SSP:
(a) Period of service: SSP requires 13 weeks, while the employer’s scheme requires 26 weeks of service from employees. The WRC took into account that most employees had more than six months of service. The Adjudication Officer noted that the company’s eight weeks of sick pay was more favorable than the standard scheme.
(b) Number of days absent: It was acknowledged that not paying sick pay for the first three days of absence is a disadvantage for an employee who is absent for a maximum of three days in a 12-month period. However, the AO was of the view that this was outweighed by the fact the respondent pays sick pay for up to eight weeks in 12 months after three days of absence.
(c) and (d) Length and amount of sick pay: The AO commented that there can be no arguing that having eight weeks of paid sick leave is better than receiving only three days of SSP. Similarly, getting paid 100% of the salary by the company is more advantageous than SSP, which pays 70% of the salary and is capped at €110.
(e) Reference period: The reference periods in this case were deemed equal.
Ultimately, the WRC ruled that the employer’s scheme was more favorable to the employee, and the claim for SSP was unsuccessful. This case provides insight into how the WRC evaluates company sick pay schemes in comparison to SSP.
Additionally, as SSP gradually increases up to ten days in 2026, employers should regularly assess whether their company scheme remains more advantageous.
