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Dublin: 14 °C Saturday 11 July, 2020
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Column: Making employers pay for sick leave is simply not fair

Placing social welfare costs onto businesses is an additional burden on employers and will result in job losses writes Ian Martin.

Ian Martin

TO MAKE EMPLOYERS pay up to the first four weeks of sick pay is unfair. As it stands, the State currently pays. When an employee calls in sick they must sign onto the social welfare – and it can tend to focus the mind of the employee as to when they will be returning back.

If the Minister for Social Protection’s measures are brought in, the employer will now have to pay the staff member that is out sick and may also have to hire a temporary worker and pay that wage also. Businesses are already trying to keep their heads above water and this is a blow to businesses that many will not be able to take. If this comes into effect it will be an additional cost to the employer – one that many will not be able to afford.

Jobs

The business community are resilient – we have survived five years of this downturn – who knows how many years are left. There is only so much of the burden businesses can take. The small business community will continue, but there is a need for support too. There is a lot of discussion about the government’s job initiative and while there is change, it is slow to happen – that is the main problem, but the government can’t make the changes over night either and we understand that. Businesses recognise that the country is in a dire situation at the moment, but job creation is the only way forward and this will not encourage that.

Not only is this an unfair measure to impose on businesses, for smaller businesses it will be a major administration issue. If you are a small business you will have a system in place on how you pay your staff. It could be the beginning of the month or the end of the month. If this sick pay plan is implemented, employers are going to have to start readjusting their payrolls before they can pay people.

There are other impracticalities too. If you are an employer, employing people on a part time basis – two hours here and there – you can imagine the difficulty trying to calculate the sick pay for that said worker for someone who has been missing for one or two days, not to mention for the people who may also be receiving social welfare benefits.

Out of line

There has been significant reaction in the business community on this – we are not very happy about it. There has been no dialogue about it, we haven’t been given the chance to sit down with the minister and discuss the issue. She is imposing these measures and we need to discuss the practicalities if this is going to happen. The minister is quoting other systems stating that we are out of line with other countries in relation to sick pay. She is saying - well this happens in Europe or the UK – but this is simply not true, our system is totally out of kilter with what is happening in the UK, they operate differently altogether.

I’ve had times where my staff have been sick and we have had to get in additional workers to cover their work load. Why should we as the employer also have to pay. Employers and their employees already contribute significantly to the social welfare bill through the PRSI system and placing social welfare costs onto business is simply an additional cost on employment and it is completely unacceptable.

Small businesses are already struggling to maintain jobs and any measures that add directly to the cost of employment will result in job losses and will act as a strong disincentive to job creation. It may force employers to revisit any sick pay policies which they offer, its not fair.

This initiative will be the final nail in the coffin for job creation by small businesses and it will cost jobs for sure – there is no doubt about it.

A presentation to TDs and Senators on the sick pay issue took place today in Leinster House. The presentation was hosted by Senator Mary-Ann O’Brien (Lily O’Brien Chocolates) and Senator Fergal Quinn. Ian Martin is  the business-owner of Martin Services and Chairman of the Small Firms Association. Speaking at the seminar today he highlighted the practical implications this proposal would have for his business.

Sick pay proposal will affect childcare service provision – survey>

€26million: The annual bill for sick leave in the civil service>

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Ian Martin

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