Important Change to Employee Entitlements – Sick Leave
It is important for all employers to know about the forthcoming changes to the Holidays Act 2003 which will apply from 24 July 2021. More particularly, the Act has been amended to increase sick leave entitlements for employees. The purpose of this change is to provide employees with greater access to sick leave. It reflects a recognition, vividly highlighted by the COVID-19 pandemic, that when employees are sick, they need to have adequate leave to enable them to stay at home to reduce the spread of illness.
The main change to be aware of is that an employee’s annual entitlement to paid sick leave increases from 5 days per year to 10 days per year. It is important to note, however, that an employee’s entitlement to 10 days sick leave will only take effect on their first sick leave anniversary date falling on or after 24 July 2021. By way of example:
- If an employee commenced employment on 1 June 2020, their entitlement to five days paid sick leave arose 1 December 2020 (after six months of continuous service). Accordingly, under the amended legislation, that employee will only become entitled to 10 days’ paid sick leave on 1 December 2021.
- If an employee commenced employment on 10 April 2021, they will become entitled to paid sick leave on 10 October 2021 (after six months of continuous service). On this date, the employee will be entitled to 10 days of paid sick leave because the new Act will be in force when the entitlement first accrues due.
As part of the above change, employees will only be entitled to carry over up to ten of their sick leave days each year (reduced from 15), up to a maximum cap of 20 days.
Employers should ensure they are prepared for this legislative change by ensuring that all new employment contracts refer to the new entitlements, informing current employees of the above changes to their sick leave entitlements, updating existing employment agreements and/or policies and ensuring payroll systems are ready for the change.
If you would like further advice or information, please don’t hesitate to contact one of our team at Harmans Lawyers.