ISME survey warns of job losses if mandatory sick pay proposal adopted

A new survey reveals that the small business community is strongly opposed to the Government’s controversial mandatory employee sick pay proposal.

More than 90% of the 766 companies quizzed by small firms lobby group, ISME, said the proposals, made late last year by Minister for Social Protection Joan Burton, could result in job losses and would increase their cost base further.

Just over 70% of respondents said they felt such a move would increase absenteeism levels.

Currently, around three-quarters of all Irish SMEs (small and medium-sized enterprises) do not have a sick pay scheme in place.

“The survey clearly indicates SME opposition to a plan that will put further pressure on costs, will lead to increased absenteeism and will result in the loss of thousands of jobs, adding to exchequer costs,” according to ISME chief executive, Mark Fielding.

Mr Fielding added that the “mad-cap” proposal is “a non-runner”.

ISME has been a vocal critic of the proposals since they came to light in November and has been joined in its opposition by the likes of Chambers Ireland and IBEC.

It has been estimated that the combined cost to businesses, of the measure, will be an additional €150m a year, without factoring in other negative prospects such as absenteeism and lost productivity.

“This Government is supposedly promoting and encouraging enterprise and job creation on the one hand, while on the other this mad-cap proposal is a definite job killer, creating an atmosphere of uncertainty among the small business community, which is stymieing business activity, investment and employment creation,” said Mr Fielding.

“We already pay PRS Insurance to cover sick pay, we pay for a replacement and now we’ll have to pay sick pay — which logic dictates will increase absenteeism — thereby increasing the cost further. The minister is obviously living in cloud cuckoo land if she thinks this proposal is a runner,” he added.