Sick Leave Pay 2025: Everything Irish SMEs Need to Know

Amergin Group

Published: September 2025
Author: Amergin Consulting Ltd.
Target Audience: SME Owners, HR Managers, Finance Directors

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Executive Summary

Statutory Sick Pay (SSP) is no longer an optional benefit but a legal requirement under the Sick Leave Act 2022. As of January 2025, Irish employees are entitled to five days of paid sick leave per year. For SMEs, this reform is more than a payroll adjustment – it’s a compliance challenge that, if ignored, could result in Workplace Relations Commission (WRC) disputes, fines of up to €2,500 for poor record-keeping, and compensation orders of up to four weeks’ pay.

For many SMEs, the change raises practical questions: How do I calculate 70% of daily pay for staff with irregular hours? How do I align my company sick pay scheme with the statutory minimum? How do I keep compliant records without overburdening admin staff?

This article provides a comprehensive guide for Irish SMEs, covering legal entitlements, payment rates, eligibility rules, calculation methods for different staff types, and record-keeping obligations. It includes practical calculation tables, common pitfalls, and guidance on how to integrate statutory sick pay into existing company policies.

SME leaders face a choice: treat SSP as another box-ticking exercise or use it to strengthen trust and retention, while safeguarding compliance. With proper systems and expert support, SSP becomes not just an obligation, but a manageable part of running a resilient business.

Quick Facts: Statutory Sick Pay 2025

Market Context

• Sick Leave Act 2022 introduced SSP, phased in from 2023.

• Entitlement increased from 3 days (2023) → 5 days (2025).

• Future increases (7 days in 2025, 10 by 2026) have been deferred pending review.

• Fines: up to €2,500 for missing records; up to 4 weeks’ pay in WRC compensation.

Service Economics

• Employer-funded: 70% of daily pay, capped at €110/day.

• Applies to all eligible employees (including part-time) after 13 weeks’ continuous service.

• Requires medical certification from day one.

Common Triggers

• Short-term absence of certified illness.

• Staff on probation or part-time reaching 13 weeks of service.

• Overlap between statutory entitlement and company sick pay schemes.

Who Benefits Most

• Employees with limited or no company sick pay.

• SMEs that align policies early to avoid disputes.

• Employers that streamline compliance through professional payroll support.

1. Legal Entitlement and Number of Days

Under the Sick Leave Act 2022, employees are entitled to statutory sick pay once they have 13 weeks of continuous service. In 2025, the entitlement is five days per calendar year.

• The days can be consecutive or non-consecutive.

• Unused entitlement does not carry over to the next year.

• The entitlement is calendar-based, not based on an employee’s work anniversary.

• It applies to full-time, part-time, fixed-term, and probationary staff (after 13 weeks).

For SMEs, this means every employee on your books can claim up to five days’ paid sick leave annually once eligible. Employers cannot reduce or defer this entitlement by internal policy.

2. Payment Rate and Caps

Employers must pay 70% of the employee’s normal daily earnings, subject to a cap of €110 per day (Citizens Information).

Examples:

• Daily pay €100 → SSP = €70 (70% of €100).

• Daily pay €200 → SSP = €110 (capped).

• Daily pay €80 → SSP = €56 (70% of €80).

“Normal daily earnings” include basic pay and fixed allowances, but exclude irregular overtime or commission. Employers can voluntarily pay more, but not less.

Importantly, SSP is employer-funded. There is no state reimbursement. For illnesses beyond 5 days, employees may claim Illness Benefit from the Department of Social Protection.

3. Eligibility and Certification Requirements

To qualify for SSP, employees must:

• Have 13 weeks’ continuous service with the employer.

• Provide a medical certificate from a registered GP confirming unfitness for work.

Statutory sick pay is not payable without certification. SMEs should implement a clear process: staff must present a doctor’s note from day one of absence.

Key considerations:

• Probationary staff qualify once the 13-week service threshold is met.

• Part-time employees qualify on the same basis as full-time staff.

• Sick leave days apply only to days an employee was rostered to work.

4. Calculating for Fixed and Variable Wages

Getting the calculation right is one of the most common challenges. Here’s how to approach it:

Salaried, Fixed Hours

Part-Time, Fixed Hours

Variable Hours, Variable Pay

Employers must maintain documentation of the calculation, including rosters and pay records, to prove compliance.

5. Mandatory Records and Common Risks

Employers must keep sick leave records for 4 years, including:

• Employee details and service dates.

• Dates of statutory sick leave taken.

• Amounts of SSP paid.

Failure to keep records can lead to fines of up to €2,500 (WRC).

Callout Box: Common Pitfalls for SMEs

• Not requesting or recording medical certificates.

• Assuming probationary or part-time staff are exempt.

• Overlooking the €110 daily cap and miscalculating pay.

• Relying on outdated company sick pay schemes that are less favourable than the statutory minimum.

• Failing to update employee handbooks and payroll systems.

SMEs found in breach may face WRC claims, with compensation awards of up to four weeks’ pay in addition to statutory penalties.

The Amergin Advantage: Compliance Without Complexity

Amergin Consulting helps Irish SMEs integrate statutory sick pay seamlessly into payroll processes. Our services provide:

• Compliance assurance: Updated payroll parameters to calculate SSP correctly.

• Policy alignment: Review of company sick pay schemes to ensure they meet the statutory minimum.

• Documentation systems: Record templates and digital solutions to meet 4-year retention rules.

• Employee communication support: Clear guidance for staff to avoid disputes.

By outsourcing payroll and compliance functions, SMEs save time, avoid disputes, and free resources to focus on growth.

FAQs

Do I have to pay SSP if an employee doesn’t bring a doctor’s note?
No. A medical certificate is mandatory for entitlement.

What if my company already offers 10 paid sick days?
If your policy is “more favourable overall”, you may be exempt from paying statutory sick pay. But ensure your scheme has no waiting days or exclusions that make it less favourable in practice.

Does SSP apply to probationary or part-time staff?
Yes. Once they have 13 weeks’ continuous service, they are covered.

Can unused SSP days roll over?
No. Entitlement resets each calendar year.

Conclusion: Treat Sick Pay as Strategy, Not Just Compliance

Statutory Sick Pay is now a permanent fixture in Irish employment law. For SMEs, this means a dual challenge: ensuring payroll systems are compliant while also maintaining staff trust and morale. Done poorly, it risks fines, disputes, and unnecessary admin. Done well, it enhances reputation as a fair employer and reduces costly turnover.

SMEs that proactively align policies, automate calculations, and train managers will stay ahead of compliance – and strengthen resilience in the process.

Ready to Check Your Sick Pay Policy?

Want to check if your sick pay policy is compliant? Request our practical SSP checklist or book a complimentary consultation with our team today.

About Amergin Consulting Ltd.

Amergin Consulting Ltd. is a Dublin-based consultancy specialising in SME financial advisory, payroll, and compliance services. With proven expertise supporting over 500 Irish businesses, we combine traditional accounting excellence with forward-looking advisory solutions. Our integrated approach helps SMEs navigate complex regulatory environments, including GDPR, the Work-Life Balance Act 2023, and Auto-Enrolment 2026.

Disclaimer

This publication provides general information and does not constitute financial or legal advice. While every effort has been made to ensure accuracy, business conditions and regulations evolve continuously. SME owners should consult qualified professional advisors for guidance on specific situations. Compliance with applicable regulations remains each business owner’s responsibility.