Extension of sick pay term criticised

Employers’ groups have criticised the Government’s decision to extend the eligibility for sick pay claiming it will place additional financial pressure on many Irish businesses.

The change will result in workers only becoming eligible for illness benefit after being sick for six days compared to the current entitlement after three days.

The measure, which comes into effect from Jan 1, is expected to achieve annual savings of €22m. ISME, the organisation representing small and medium enterprises, said the extension of the eligibility criteria for sick pay would put extra pressure on already struggling small firms and their staff.

ISME chief executive Mark Fielding said the measure was a “not so subtle attempt to transfer social insurance responsibility from the Government to employers”.

He claimed the change to the eligibility for illness benefit made working conditions in the private sector even less attractive than in the public sector.

Employers’ group, IBEC said the measure combined with an increase in the lower rate of employers’ PRSI would make it more difficult for companies to create jobs.

The Dublin Chamber of Commerce expressed disappointment that the extension of sick days to claim illness benefit which it said was passing on more of the cost of the social insurance scheme to employers who had been working tirelessly to reduce their labour costs.

Joan Burton, the social protection minister, said the cost of illness benefit and other invalidity payments to workers was significant and represented 16% of expenditure from the social insurance fund — more than might be expected based on census figures of people unable to work.

However, Ms Burton said that any abuse of sick leave was primarily a matter for employers to manage.

She also expressed hope that employers who historically pay staff out on sick leave would continue to do so.

Asked if the measure to reduce eligibility for illness benefit could place pressure on families where the main breadwinner fell ill resulting in the loss of a week’s income, Ms Burton that said other social welfare payments were available for people who found themselves in unexpected hardship.