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Budget 2013

Statutory sick pay 'could threaten 42 per cent of businesses' - IBEC

The employers’ group publishes a survey saying almost half of all firms believe paying sick employees could affect their sustainability.

AROUND THREE in every seven Irish businesses claims any move by the government to make them cover the cost of sick pay could threaten their sustainability, according to a survey published this morning.

The employers’ group IBEC says 42 per cent of the 450 firms which responded to its survey said their businesses could become unsustainable if the government proceeds with reported plans to make employers cover the first two weeks of an employee’s sick leave.

49 per cent of firms said the proposal would affect their ability to recruit new employees, and 47 per cent said it could affect their ability to retain their current staffing levels.

The survey also found that 76 per cent of employers would revise their existing sick pay and entitlements schemes if a statutory sick pay scheme was introduced, with employers split equally between reducing the level of pay to staff and the duration of a sick pay period.

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

“Such a move would increase labour costs, reduce the capacity for companies to maintain and create jobs and damage hard-won competitiveness gains of recent years.”

McGinty argued that the government’s priority should be to reduce costs on employers so that they can create more jobs.

He argued that under OECD research, which equates 1 per cent tax increase with a 0.4 per cent fall in employment, a statutory sick pay scheme could mean about 3,500 staff losing their jobs.

Read: Government defeats FF Dáil motion to stop sick pay changes

Column: ‘Making employers pay for sick leave is simply not fair’

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