Stay ahead of the curve with our exclusive Q&A series, brought to you by leading law firm, A&L Goodbody, LLP, designed to answer your most pressing legal questions. These expert insights provide clear guidance to ensure your HR practices remain compliant and protect your organisation.  

What does the 2022 Act provide?

On 1 January 2023 the Sick Leave Act 2022 (the 2022 Act) came into force, providing employees in Ireland with the right to statutory sick pay (SSP) for the first time.

This right is contingent on employees having 13 weeks’ continuous service and providing their employer with a medical certificate. The statutory sick leave entitlement is currently a maximum of five days of paid leave in any calendar year, and sick pay is currently calculated at a rate of 70% of normal pay (up to a maximum of €110 per day). The entitlement was due to increase to seven days in January 2025, but this increase is currently on hold pending a review and will likely be a matter for the next government.

Section 8, 9 and 12 of the 2022 Act provide as follows (respectively):

•    In circumstances where an employment contract provides for sick leave provisions that are as favourable, or more favourable than the statutory sick leave entitlement, they shall be in substitution for, and not in addition to, that entitlement. 
•    The obligations under the 2022 Act do not apply to employers who provide employees with a sick leave scheme that confers ‘‘benefits that are, as a whole, more favourable to the employee than statutory sick leave’’.  
•    There is an obligation on employers not to penalise (or threaten to penalise) an employee for proposing to exercise or having exercised, their entitlement to statutory sick leave.

When is an employer’s sick leave scheme, as a whole, more favourable than statutory sick leave?

Section 9(2) of the 2022 Act sets out the factors that will be considered when determining if an employer’s sick leave scheme confers benefits that are, as a whole, more favourable to the employee than statutory sick leave:

(a)    the period of service of an employee that is required before sick leave is payable
(b)    the number of days that an employee is absent before sick leave is payable
(c)    the period for which sick leave is payable
(d)    the amount of sick leave that is payable
(e)    the reference period of the sick leave scheme

Is there any case law under the 2022 Act?

Katerina Leszczynska v Musgrave Operating Partners

The case of Katerina Leszczynska v Musgrave Operating Partners (July 2023) was the first decision under the 2022 Act. It examined the circumstances in which an employer who provides a sick pay scheme is exempt from the obligations under the 2022 Act.

The claimant was absent from work due to illness for four consecutive days in 2023 and sought SSP. The respondent argued that the company’s sick pay scheme was more favourable than SSP. The company’s sick pay scheme provided for eight weeks fully paid sick leave, with the first three days being considered as ‘waiting days’ which were not paid. 
The WRC applied the test set out under Section 9(2) of the 2022 Act and found that the company’s sick pay scheme was as a whole, more favourable than statutory sick leave.  This determination was made notwithstanding the fact that statutory sick leave was more favourable than the company’s sick leave scheme in respect of the length of service that an employee is required to have completed before sick leave is payable, and the number of days that an employee must be absent before sick leave is payable.  

Alan Lehane v Sean Ahern Ltd

The WRC endorsed the Leszczynska decision in Alan Lehane v Sean Ahern Ltd (Sep 2024) and found that the employer’s sick pay scheme was more favourable overall than entitlements provided for under the 2022 Act, notwithstanding that the complainant had been disadvantaged by a three day unpaid waiting period under the employer’s sick pay scheme, and the fact that the employer’s sick pay scheme provided for sick pay at a lower rate than statutory sick pay.

The complainant had been absent from work for three days in January 2024 and was seeking payment for these sick days under the 2022 Act. His employer informed him that the sick pay scheme provided by the company did not pay out until the fourth day of absence. The case centred around the determination of what constitutes more favourable in terms of the sick leave policies:

•    Where an employer pays out from day one but for a limited number of days (five days in this case); or
•    Where an employer does not pay out until the fourth day but continues to pay for a longer period (50 days in this case).

The WRC recognised that, while the three-day waiting period put the complainant at a disadvantage, this was outweighed by the fact that the employer’s scheme continued to pay for 50 days, albeit at a lower rate.

Ann Briton v Amcor Flexibles Ltd

The case of Ann Briton v Amcor Flexibles Ltd (June 2024) highlights the impact of the applicable reference period on determining whether an employer’s sick pay scheme is more favourable than statutory sick leave.

The claimant was absent from work for a period of five days.  The WRC assessed whether the employer was correct in refusing the complainant’s SSP request on the basis that the company’s sick pay scheme was, as a whole, more favourable than statutory sick leave. The WRC found that the employer’s sick pay scheme was more favourable when evaluating the qualifying period (period of service of an employee that is required before sick leave is payable) and the waiting period (number of days that an employee is absent before sick leave is payable).  However, 12 months’ service was required before sick leave was payable under the employer’s sick pay scheme.

The WRC rejected the employer’s argument that benefits outside of a reference period (i.e. in future years) can be used to conclude that an employer’s sick pay scheme is more favourable, as a whole, than SSP and thus justify no payment at all during a reference period.  During the 12-month reference period the employer’s scheme provided no sick pay benefit at all. The WRC found that this fell below the minimum benefit intended by the 2022 Act.

The employer’s sick pay scheme was found to not be more favourable, as a whole, than statutory sick leave, and the WRC upheld the complaint.  This case can be differentiated from the above two cases, which provided some payment during the reference periods.

What are the key takeaways for employers?

In determining whether an employer’s sick pay scheme is, as a whole, more favourable than statutory sick leave, the WRC will have regard to all of the criteria set out in section 9(2) of the 2022 Act. The WRC will critically analyse the evidence adduced by the parties in support of their respective arguments as to why an employer’s scheme is, or is not more favourable, as a whole, than statutory sick leave. 

Employers will need to take account of all relevant factors, when determining whether their sick leave policy is, as a whole, more favourable than statutory sick leave.  

Given that SSP is due to gradually increase over time, up to ten days in 2026 (albeit that the increases are currently on hold), employers should bear in mind that if this entitlement increases, they will need to assess on an ongoing basis whether their sick leave scheme remains more favourable, as a whole, than statutory sick leave.