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Employers warn that Burton’s sick pay proposals will result in job losses

Image: Svenstorm via Flickr

EMPLOYER INTEREST GROUPS have warned that the government’s plans to make them foot the bill for the first four weeks of employees’ sick pay will result in job losses.

Social Protection Minister Joan Burton today held a consultative forum that considered plans to make employers foot the bill for the first four weeks that workers are off sick with the “feasibility and potential impacts” of such measures discussed.

She is reported to have told the forum in Dublin that the number of people claiming illness and disability payment had increased by 40 per cent over a ten-year period from 2001 to 2011 and cost the State €876 million last year alone.

Burton estimates that the changes could save some €89 million per year and hopes her proposals can be finalised in time for the next budget, RTÉ reports.

The proposals were welcomed in some quarters but the Small Firms Association (SFA) condemned the idea saying that it would result in job losses and will act as a “strong disincentive” for job creation.

Its words were echoed by the Irish Business and Employers Confederation (IBEC) which has consistently criticised the plans to shift the cost of sick pay onto employers.

“This amounts to an additional flat tax on employment, which all businesses will have to pay regardless of their profitability, and is completely unacceptable,” SFA director Patricia Callan said today.

“Employers and their employees already contribute significantly to the social welfare bill through the PRSI system.”

She added: “The Minister is going about this in entirely the wrong way. At the very least, a regulatory impact assessment should be undertaken immediately to assess the impact of the proposal on jobs and competitiveness and the cost/benefit to small business.”

Meanwhile, IBEC said today that the government was just “shifting” costs onto employers and added that the plans were at odds with the government’s Action Plan for Jobs announced last week.

“Putting additional social welfare costs onto employers is simply an extra tax on employment, at a time when jobs should be the priority,” IBEC Director Brendan McGinty said.

“The Government needs to start coming up with sensible and economically sound ways of reducing employment costs, instead of just shifting costs onto employers.”

Burton puts forward plan to make employers pay for sick leave

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Comments (43 Comments)

  • Glyko Symoritis 20/02/12 #
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    Mark my words when I say that these 2 , they’ll have us all paying from our pockets when we get sick. If we lucky enough to have a job!

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  • Dave Cahill 20/02/12 #
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    Personally, I think that no sick day should be paid. However, to keep the leftie unions happy we could just put a simple cap on how many paid sick days an employee can take. I think that 3 days per annum is more than reasonable. Anything over that should be at the total discretion of the employer.

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    • Steph Duffy 20/02/12 #
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      As PRSI payers, employees are entitled to have some level of payment when ill.

    • Dave Cahill 20/02/12 #
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      Yes but from the government, not the employer.

    • Steph Duffy 20/02/12 #
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      I believe that should be at the employers discretion, as is the current situation.

    • Sarah Curran 20/02/12 #
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      Steph your employer pays Alot more prsi than what you pay!

    • Steph Duffy 20/02/12 #
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      I am well aware of PRSI rates Sarah, I am an employer also.

    • Eimear Lavery 20/02/12 #
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      I hope you never get sick! Speaking as someone who had to take almost 6 months sick leave a couple years back, if it wasn’t for social welfare & great employers I don’t know what I would have done!

    • Dave Cahill 20/02/12 #
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      That’s my exact point Eimear. You are already paying for the sickness insurance in your PRSI contributions so the government should have the basic responsibility. IMO, everything above and beyond that should be at the discretion of the employer. If you are a committed and loyal employee with a genuine illness, then any decent employer should recognise that. By the way, I think that the cap should only exist if Joan Burton gets her way and the basic responsibility instead lies with the employer as opposed to the government.

    • voice of raisin 21/02/12 #
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      It’s not about being a “decent employer” or not – this could sink small companies, no matter how well they try to treat their employees. Think about it – why should they pay someone for time they’re not there, when they either have to dump the workload on someone else, or pay another person to do that work? It’s completely unjust. Why not just make employees have a whip around to cover the sick colleagues…

      This is the responsibility of the government, and why employees and employers already pay a tax SPECIFICALLY to cover stuff like this.

      I get more and more disillusioned by this sorry excuse for a government every day they announce nonsense like this.

  • Terry Turner 20/02/12 #
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    This is mad. Many people do not get or claim sick pay. They take few days off. No big deal.
    This idea if implemented will cause trouble for people and employers. Conflict between employees and managers are bound to ensue if the employers have to take a serious interest as to whether a sick absence is genuine. Workers will look for sick pay from companies stretched to meet its bills. People in poor health will be more at risk of loosing their job.

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  • Paul mc namara 20/02/12 #
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    Who is going to pay the sick leave for the one group of workers who have way more sick days than any other ? !!!!!!!!! Public service!!!!!!!!!!! ——-

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    • Patrick Mooney 20/02/12 #
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      You need to back that up as a public sector worker I and my colleagues don’t unless we really have to and what is PRSI that both the worker and the employer for. If you fall into that media and government trap which is to divide and conquer then we are all finished. How treats you when you sick, protects you, teaches your children and educates the future of our county. Next time your ill or robbed or need education don’t use the public sector and see how far you get. Yes there are problems at the top but don’t blame the workers.

    • voice of raisin 21/02/12 #
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      Sorry Patrick, but it’s absolute fact that average sick leave in the public sector is many times more than the private sector. This isn’t about “divide and conquer” – it’s just established fact.

    • Bernadette Dunne 21/02/12 #
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      ———-???????———- and Gardai and Prison Staff, Nurses, that are injured in the coarse of their duty and are they not entitled to sick pay?

    • Cormac Ginty 05/03/12 #
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      The sooner Labour get booted out of government the better. They have the finest collection of smart politicians who are deluded and removed from market economics. I say scrap sick pay altogether for short term illness. Meaning you don’t get paid sick pay if out for less than two weeks. It would solve the HSEs staffing problems, the government sick pay bill would be slashed, and small firms would be protected.

  • jimbo 20/02/12 #
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    Well done bruton is it a wonder the country is shagged,yet you guys claim sick days 5 fold worse than the taxpayer,your just out to line your own pockets to cover your sick days..

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  • Réada Quinn 20/02/12 #
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    This has to be the icing on the “fantasy cake” they made called Job Creation! What employer will consider creating jobs while we have ministers thinking up ridiculous ideas like this. Of course there’ll probably be a tax free scheme thought up for multinationals! And what are we paying PRSI for?

    Really Joan, it’s time to take a bow. Don’t expect any bouquets to be thrown your way.

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  • Sarah Curran 20/02/12 #
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    small firms cannot afford to pay for sick days most are just about breaking even at the moment.

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  • William Grogan 20/02/12 #
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    It could be worse. In France employers including very small businesses have to pay the first 6 months sick pay. So few small businesses employ anyone other than relatives. PS Employers PRSI is 50% v about 11% in Uk+Irl

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  • Robin Blandford 20/02/12 #
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    They should compensate the doctors with a bonus who find nothing wrong with a person and sends them back to work!

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    • Conor Croke 20/02/12 #
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      Currently they pay doctors to issue a sick note, but it is probably more than a little bit morally wrong to financially incentivise a professional who is meant to be objective on the matter for negative results…

  • Aaron McKenna 20/02/12 #
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    One hand really doesn’t know what the other is up to in this country. Day 1: Lowering business costs, getting people back to work. Day 2: Sick pay is now your problem.

    So employers, who pay 10.75% PRSI on wages to cover social insurance, will bear the cost of sick pay, and either increased sick pay or policing sick pay. This is on top of replacing workers out sick, when you can’t just stop production / close your shop etc.

    It’s also disingenuous of Burton to say employers do this elsewhere. In the UK employers pay the sick pay to save the government some paperwork, and then claim the money back off the EPRSI they pay.

    I’d love a consistent policy position from this government…

    (By the way, my company pays sick pay already. It’s a benefit we can afford and works in our business. But it’s not a one size fits all approach that can fit many small businesses.)

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    • Sarah Curran 20/02/12 #
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      you hit the nail on the head there. completely agree

    • Cormac Ginty 21/02/12 #
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      Good post. I too am an employer, but I don’t pay for sick days. Absenteeism is not a problem. If someone is sick then someone else gets the hours. If I have to pay for sick time, it means I have to pay double time to cover the hours. I would need proof that the employee was sick if I am expected to pay for it (even for one day). So GPs may be signing a lot more sick certs …. it a wonder she doesn’t want the employer to pay for sick certs too.
      What will happen in practice in small firms is that when someone is absent due to sickness, it will be frowned on. As employees won’t want to get in the bad books, they will be less likely to take sick leave, even when genuinely unfit to work.

  • Dec Rowe 20/02/12 #
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    And we get called negative when we complain about this kind if thing and when we also complain about our Taoiseach flying off to the states to secure a few jobs!!! This shower if shams are making a bigger mess of things than their predecessors! How can we possibly expect good job growth when the government are driving jobs out of the country faster than bringing them in!?

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    • john 20/02/12 #
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      The last shower bankrupted the country. Dont ever forget it. National Debt=160 billion Euro. The IMF+EU are our financial overlords. Our banks are bust. That’s the last shower for you. Have you forgotton so soon. You Irish never learn

  • Deirdre Burke 20/02/12 #
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    she has no right to hold the title SOCIAL PROTECTION..SHE she has taxed and undermined every minority group in this country, including employers. they should not pay sick leave , this is why you pay your prsi.. and also doctors need to use discretion here…

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  • Barry Murphy 20/02/12 #
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    As an employer this foolish sick pay scheme together with the changes in redundancy will stop me employing new staff. Government needs to start listening to employers who are the ones that will create jobs to get us out of this recession. They also need to read their own jobs initiative!!!

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    • Gill Jones 20/02/12 #
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      It’s all right Barry, you can avail of the infamous jobsbridge, many highly educated and skilled workforce for free! :) This country will be right on track………in the next 50 years or so.

  • David Sheridan 20/02/12 #
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    Does ‘Burton the Butcher’ still get paid if she is sick?

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  • Gerry Walsh 20/02/12 #
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    As an employer and business man of 18 years I will SHUT my Dublin office if this is even considered !!!!!!!! Crazy !!!!!!!!!!!! I PAY ENOUGH !!!!!!!!

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    • Bernadette Dunne 21/02/12 #
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      Yes you do pay enough you pay the wages for the work carried out you also pay annual leave,bank holidays,public holidays, You pay EMPLOYERS PRSI for each of your staff Jesus what do they want they say they want to create jobs well give us one job that this Government have actually put in place and if they pass this rule that employers must pay sick leave well every employer should strike as in close up FOT a fat a week a month whatever it takes your loyal staff will back yea up

  • Popsicle Pete 20/02/12 #
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    It will make sense if it manages to cut down on exaggerated illnesses, if the boss is paying they’ll need to be convinced the employee is completely unable to work.

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  • Davyleds 20/02/12 #
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    Make the EMPLOYEE pay for his own sick days… and watch the number of sick days plummet

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  • kopbabe 20/02/12 #
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    i think if its uncertified then the employees shouldnt get paid. would definitely get rid of some of the monday morning blues!!! but if certified then the gov has to cough up through social welfare. no way can we expect employers to foot this kind of bill……ludicrous.

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    • voice of raisin 21/02/12 #
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      It would help, but doctors are way too quick to hand out sick certs these days. So what might happen is that people will just cough up the 50 quid and get a note to take the whole week off while they’re at it.

  • Anthony O'Brien 20/02/12 #
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    ………………..more encouragement for the black market. And as a side note, this will create serious employer/employee tensions if implemented.

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  • Mark Rodgers 20/02/12 #
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    Illness and disability payments have increased by forty per cent in the past ten years says the Minister.
    Wow………….there must be something out there that’s being missed by mainstream medicine because any payments by Social Welfare is ONLY on the basis of a Medical Certificate signed by the individual’s respective doctor.
    There are no trends whatever in the medical literature to suggest that any disease state of any description whatever has increased by anything remotely close to this number.Remember these data and payments do not include single days of illness that tend to coincide with days such as Mondays!
    Clearly the Minister is saying that Companies or Managers are not managing and the best way to reduce this burden on the State is to bring the cost closer to where the issue should be corrected.
    Perhaps another very simple approach is the idea that all doctors in family practice would be compelled to refer their patient to another local doctor where a second certificate of illness is required in the same calendar month while excluding certain chronic illnesses.
    The nett effect of these two measure would be a dramatic and sustained improvement in the health of Irish workers!

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  • Tigerisinthezoo 21/02/12 #
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    If the patient pays the doctor the patient gets the benefit and if the company pays the opposite will happen. It would cause a lot of friction. Maybe employer gov go half way in paying.

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  • Deirdre Flannery 21/02/12 #
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    the employee should go without pay for uncertified sick leave. woudl certainly reduce the public service “sick leqve” issue (if there is one over the public sector, not convinced re teachers though in helathcare maybe). if certified sick leave, well then i think fairness dictates that the sick pay is split 50:50 between the employer and the Dept of social welfare. it is more just and fair than joan burton’s Dept having to cut that 876million (the cost of the sick pay to her Dept) from elsewhere in her budget…..which is there to protect the disabled, the elderly, the unemployed and genuine welfare recipients. Else that full bill must be cut again from welfare over the next few years……….without cutting rates of basic welfare as they say stands….or it will have to be shared with emplyers, some of whiuch are large profitable multi-nationals, don’t forget. there but fo the grace of God go any of US, say if you have an accident that disabled you, have a disabled child or lost ur job due to the economic crisis. which sounds fairer to you? i think a compromise as suggested? and a reduction in absenteeism :)

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