Year End 31 st December Republic of Ireland Payroll Overview
Agenda Country overview Business culture Glossary of terms and abbreviations Employer obligations Build up to gross pay Gross to net calculation Types of Leave Expenses and benefits Net pay and making payments to employees How to read a payslip Special types of employees/employments Year end Record keeping Data protection highlights
Types of Leave
Types of Leave There are different entitlements to leave : Annual Leave Public Holidays Maternity leave Adoptive Leave Carer s Leave Parental Leave Force Majeure Leave Compassionate Leave Jury Service
Annual Leave
Annual Leave The Organisation of Working Time Act 1997 gives a basic minimum annual leave of 4 weeks per year more may be given in the employment contract Pay in respect of annual leave is paid in advance (except for salaried employees) at the normal weekly rate If the pay varies then an average of 13 weeks before the leave should be used to calculate the rate Agency workers - the party who pays the wages is the employer for the purposes of the act and is responsible for the holidays
Annual Leave It is up to the employer to decide when annual leave should be taken, however this is subject to a number of conditions/considerations: Family responsibilities Opportunities for rest and recreation The employer must consult with the employee 1 month before the leave is to be taken (close down) Leave must be taken within the appropriate leave year, or with an employee s consent, within 6 months of the relevant leave year Further carry forward of annual leave is a matter to be agreed between employee and employer
Annual Leave There are three different ways to calculate leave 1) Based on the employees working hours in a leave year, which runs from April to March Employees working at least 1365 hours are entitled to the full 4 weeks leave unless the employment ceases during the year 2) A third of a working week for each calendar month an employee has worked at least 117 hours 3) 8% of the hours worked during the leave year, up to the maximum of 4 weeks
Annual Leave Some employers use the calendar year for leave i.e. January to December An employee who has worked for at least 8 months is entitled to a 2 weeks unbroken leave period Any sickness during year will reduce annual hours and therefore annual leave entitlement and so additional calculations are required
Annual Leave For part-timers, the third method is usually used 8% of the hours worked during the leave year and may require a wash-up at the end of the year If an employee moves to or from full time to part time in the year then calculate the entitlements separately If an employee is ill during annual leave they should provide a medical certificate for the days they were sick. The certified days do not then count as annual leave (employees may choose not to take sickness if this would be unpaid) Employees do not accrue annual leave whilst they are off sick Annual leave is not affected by any other leave available by law and should accrue during these types of leave leave accrues for only the first 13 weeks of carer s leave
Permanent Health Benefits
Permanent Heath Benefits People who pay a premium for a policy covering continuance of income and benefits during sickness, accident or injury can claim tax relief in respect of the payments made Where qualifying Permanent Health Benefit contributions are deducted via the employer, the net pay arrangements apply Employee contributions to a Revenue approved Permanent Health Insurance or Income Continuance Plans are exempt from PRSI as long as the net pay arrangement applies
53 WEEKS and 13 TH MONTH
53 Weeks and 13 th Month Employers should use weekly rates divided over the periods in the year for all Notional pay items, Tax, PRSI and USC calculations
Public Holidays
Public Holidays There are 9 public holidays in Ireland each year New Year s Day (1st January) St. Patrick s Day (17th March) Easter Monday (Good Friday is not a public holiday and so no entitlement to holiday but some businesses and schools do close) First Monday in May First Monday in June First Monday in August Last Monday in October Christmas Day (25th December) St. Stephen s Day (26th December)
Public Holidays Most employees are entitled to paid time off for public holidays as laid out in the Organisation of Working Time act 1997 Employees who qualify are entitled to one of the following: A paid day off on the public holiday An additional day of annual leave An additional days pay A paid day off within the month of the holiday
Public Holidays If a part-timer has worked at least 40 hours in the 5 weeks before the holiday and it would fall on a day normally worked, they are entitled to a days paid leave If a part timer does not work on the day of the holiday they should receive one fifth of a weeks pay, even if they are never rostered on to work during a public holiday If the employee does not have normal daily or weekly hours, an average of a days or weeks pay can be calculated using an average of the 13 weeks before the holiday An employer may choose to give the employee paid time off instead of the additional pay If a part time employee works on a public holiday they are entitled to an additional days pay
Public Holidays If an employee is a full time worker or qualifying part time worker and they are sick on a public holiday, they are entitled to the benefit for the day they missed If they are absent from work immediately before the holiday and have already been off work for more than 26 weeks due to an illness or accident they are not entitled to the public holiday In the case of occupational sickness/injury the time limit is 52 weeks Employee are not entitled to public holidays if they are absent immediately before the holiday and their absence is: Over 13 weeks due to a lay off or other reason authorised by your employer Due to a strike After the first 13 weeks of carer s leave Employees are entitled to leave for public holidays during maternity, adoption or parental leave
Public Holidays Where a public holiday falls on a weekend, employees do not have a right to paid time off on the next working day following the holiday, although one of the following must be applied: A paid day off within a month of the holiday An additional day of annual leave An additional days pay If an employee finishes a job on the week ending the day before the public holiday and they have worked for you for the previous 4 weeks, they should receive an additional days pay for the holiday
Sick Leave
Sick Leave Employees are not entitled to paid time off during sick leave unless stipulated in their terms and conditions If an employer does pay sick pay, they are entitled to ask employees to sign over their sickness benefit to offset some of the cost of the company sick pay Employers can ask for medical certificates during sick leave If the employee has an accident at work and qualifies for injury benefit, this can also be signed over to the employer to cover the costs of any paid sickness Employees can raise a claim against employers for accidents at work with the Injuries Board Employees are not entitled to benefit during the first 6 days of the sickness
Sick Leave If an employee is off sick during a public holiday they are entitled to the benefit of that holiday when they return Unless they have been off sick for more than 26 weeks (for normal sickness or accidents) or 52 weeks (for an industrial accident) before the holiday If an employee is off sick during annual leave and has a medical certificate the days must be treated as sick leave and not reduce the annual leave balance, however depending on how the leave is calculated, a reduction in hours worked could reduce the holiday entitlement This is currently only enforceable due to the wording of the Organisation of Working Time Act. There is a proposed amendment to the Act which will stop the reduction of leave due to hours worked Public Sector employees do accrue leave when off sick If an employee is on long term sick they must be allowed to carry over, or receive payment for leave not taken
Sick Pay example Example A A weekly-paid employee (Friday pay day), is out sick from Monday 23 rd May 2017. The DSP notification to the employer advises that the amount of taxable Illness Benefit awarded is 193 per week from (Monday) 30 th May Pay day Friday, 26 June Taxable Illness Benefit to be included with earnings: Nil as there are 6 waiting days Pay day Friday, 2 June The employee is still out sick. Taxable Illness Benefit to be included with earnings: one full week = 193 Pay day Friday, 9 June The employee returns to work on Wednesday 7. Taxable Illness Benefit to be included with earnings: 3 days - Saturday, Monday, and Tuesday (No payment is made for Sunday) 193.00 / 6 x 3 = 96.50
Sick Pay A fortnightly-paid employee (Thursday pay day), is out sick from Monday 8 May 2017. The DSP notification to the employer advises that the amount of taxable Illness Benefit awarded is 193 per week from (Monday) 15 th May Pay day Thursday, 18th Taxable Illness Benefit to be included with earnings: 4 days Monday 15th to Thursday 18th incl. (No payment is made for Sunday). 193.00 / 7 x 4 = 110.29 Pay day Thursday, 1 June The employee returns to work on Monday 29. Taxable Illness Benefit to be included with earnings: 8 days - Friday 19 to Saturday 27 inclusive (No payment is made for Sunday). 193.00 / 6 x 8 = 257.34
Sick Leave An employee must claim the state benefit from the DSP by submitting their medical certificate Employers are advised of the benefit to pay an employee, this may also include benefits for dependants Any benefits received from the state are subject to tax in the normal way However, PRSI and USC are not due on these payments Where occupational sick pay is paid then the difference between the state benefit and the occupational sick pay or any other payments made during the sickness period will be subject to PRSI and USC
Maternity Leave
Maternity Leave All employees, including casual workers, are entitled to basic maternity leave of 26 weeks and additional unpaid maternity leave of 16 weeks which begins as soon as normal maternity leave finishes Maternity leave must start at least 2 weeks before the end of the expected week of birth Maternity Leave must continue for at least 4 weeks following the birth Employers do not have to pay employees during this period Employees must give you 4 weeks notice and a medical certificate as notification of their intention to begin maternity and the same notice of an intention to take additional maternity leave
Maternity Leave Pregnant women are entitled to reasonable, paid time off for medical appointments before and for 14 weeks after the birth There are no limits to this time off and it must include travel time to the visits You may ask your employee for the appointment card for these visits Women are also entitled to paid time off for 1 set of ante-natal classes, except for the last 3 classes in the set Fathers are entitled to paid time off for the last 2 classes
Maternity Leave Public holidays and Annual leave should continue to accrue during the maternity leave period Employees still qualify for maternity leave for still births or miscarriages after the 24th week of pregnancy
Maternity Leave Employers should carry out separate risk assessments for pregnant employees and those who have recently given birth or are breastfeeding If risks are found the employee should be moved away from them If risks cannot be removed the employee should be put on health and safety leave from work until the maternity leave starts Employers must pay the normal pay for the first 3 weeks of this leave as set out in the Maternity Protection (Health and Safety Leave Remuneration) Regulations, after which time the employee may be entitled to Health and Safety Benefit
Maternity Leave If the mother dies within 40 weeks of the birth the father is entitled to maternity leave up to a maximum of 40 weeks after the birth If the death is within 24 weeks of the birth the father is also entitled to additional maternity leave Maternity Leave The leave should start within 7 days of the mother s death
Maternity Leave Employees rights are protected whilst they are on maternity leave and when they return they should come back to the same job If this is not possible they should be given an alternative with terms no less favourable than those they previously enjoyed Employees gets PRSI credits whilst on maternity leave If the employee chooses to take additional leave the employer should complete an application for maternity leave credits
Maternity Leave Women who are breastfeeding are entitled to paid time off work for breast feeding or expressing milk The time off is 60 minutes per day, taken in either 1 x 60, 2 x 30 or 3 x 20 minute breaks Maternity Leave
Maternity Leave Employees must claim maternity benefit from the DSP 6 weeks before they intend to start the leave Payments of maternity benefit are not subject to PRSI or USC DSP informs the Revenue the employee is on maternity leave and the value of the benefits and the tax credits are adjusted accordingly A new tax certificate will be issued to the employee and the employer with the adjusted tax credit Where occupational maternity pay is paid or if other payments are made during the period of maternity leave then the difference between the benefits and the pay received are subject to PRSI and USC These rules also apply to adoption leave Maternity Leave
Adoption Leave
Adoption Leave Adoptive mothers are entitled to take 24 weeks of adoptive leave and additional 16 weeks of adoptive leave when the 24 weeks ends Employers do not have to pay adoptive leave unless the company scheme is laid out in the terms and conditions of employment Employees are entitled to paid time off for classes and pre-adoption meetings with social workers during the pre-adoption process Leave continues to accrue during adoption leave as with maternity leave Notice needs to be given 4 weeks before the expected placement date Employment rights are protected during adoption leave in the same way as maternity leave
Paternity Leave
Paternity Leave Paternity Benefit is a new payment for employed and self-employed people who are on paternity leave from work and covered by social insurance (PRSI) It is paid for two weeks and is available for any child born or adopted on or after 1 September 2016 Paternity leave can start at any time within the first 6 months following the birth or adoption placement Employees should apply to the department of social protection for the payment 4 weeks before they intend to go on paternity leave (12 weeks if self-employed) Source: https://www.welfare.ie/en/pages/paternity-benefit.aspx
Paternity Leave You must provide proof of the expected date of birth of your child Generally you will need to provide a certificate from your spouse or partner's doctor confirming when your baby is due, or, confirmation of the actual date of birth if you are applying for leave after the birth You must register for a Public Services Card (if you don't already have one) and register with the mywelfare.ie service You must also satisfy the PRSI contribution conditions. Source: https://www.welfare.ie/en/pages/paternity-benefit.aspx
An employee you must have: Paternity Leave At least 39 weeks PRSI paid in the 12-month period before the first day of your paternity leave Or At least 39 weeks PRSI paid since first starting work and at least 39 weeks PRSI paid or credited in the relevant tax year or in the tax year immediately following the relevant tax year For example, if you are going on paternity leave in 2017, the relevant tax year is 2015 and the year following that is 2016 Source: https://www.welfare.ie/en/pages/paternity-benefit.aspx
Paternity Leave If you are an employee you must have: Or At least 26 weeks PRSI paid in the relevant tax year and at least 26 weeks PRSI paid in the tax year immediately before the relevant tax year For example, if you are going on paternity leave in 2017, the relevant tax year is 2016 and the year before that is 2015 Source: https://www.welfare.ie/en/pages/paternity-benefit.aspx
Paternity Leave Leave certification All employees must have their paternity leave certified by their employer If you are self-employed you self-certify your leave You must provide proof of the expected date of confinement of your spouse or partner In the case of adoption, you must produce a certificate of placement in relation to the child Source: https://www.welfare.ie/en/pages/paternity-benefit.aspx
Paternity Leave Leave certification In the case of an intercountry adoption that took place outside the State, employees must produce a declaration of eligibility and suitability in relation to the child and particulars in writing of the day of placement or expected day of placement If, at any stage they decide not to take your paternity leave, they cannot be paid Paternity Benefit They should inform the Paternity Benefit section of the Department of Social Protection of any changes to paternity leave arrangements Source: https://www.welfare.ie/en/pages/paternity-benefit.aspx
Paternity Leave Paternity Benefit will be paid directly into the employees bank account, unless you as an employer choose to pay a company paternity rate, in which case you can ask for the paternity benefit to be paid to your organisation to offset some of the payments received Paternity benefit is subject to tax, but not USC or PRSI Refer to http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_syste m/claiming_a_social_welfare_payment/taxation_of_social_welfare_payments.h tml for more information on taxing social welfare payments
Parental Leave
Parental Leave Employees can take parental leave in relation to certain children, including those who are acting in loco parentis to eligible children Leave can be taken for children up to 8 years old If a child was adopted between 6 and 8 years old, leave can be taken up to 2 years after the adoption order Leave can be taken for a child up to 16 years if they have a long term illness or a disability
Parental Leave 18 weeks leave can be taken per child Parents of twins or triplets can take more than 18 weeks in a 12 month period Where a parent has more than one child, a maximum of 18 weeks can be taken in any 12 month period, unless the employer agrees otherwise The 18 weeks may be taken in one continuous period or in 2 separate blocks of a minimum of 6 weeks, with a gap between the leave of at least 10 weeks Employees may request leave to be broken down into days or hours, however it is up to the employer whether they agree to this or not If both parents work for the same employer and the employer agrees then, 14 weeks of entitlement can be transferred from one parent to the other
Parental Leave If a parent becomes ill during the leave and provides, in writing, the nature of the illness and relevant evidence to the employer as soon as is practicable, the leave may be suspended and the employee should be treated as sick There is no entitlement to pay or pension contributions during the leave (unless terms and conditions provide otherwise) You must write to the Records Update Section of the DSP, detailing weeks the employee has not worked, in order for them to receive PRSI credits When the illness is over parental leave resumes Other employment rights are protected, including public and annual holiday accrual
Parental Leave An employee should have 12 months service with the employer to get the full parental leave Employees should notify you of any parental leave taken in previous employment You can postpone the leave for up to 6 months if there are valid operational reasons, such as lack of cover or seasonal variations in work Only 1 postponement allowed - any further postponements require written agreement Leave should only be taken to care for the child concerned If the employee has been has been employed for more than 3 months but less than 12 months they are entitled to pro-rated leave of 1 week for every month of employment
Parental Leave Records must be kept of parental leave taken for 8 years, detailing dates and times of leave taken Employees returning to work after parental leave can request a variation to working hours or work pattern for a limited period You must consider this request but do not have to agree to it Failure to keep these could lead to a fine of 2000
Carer s Leave
Carer s Leave The Carer s Leave Act allows employees to temporarily leave their employment to provide full time care for a minimum of 13 weeks up to a maximum of 104 weeks The person in need of care does not need to be a family member The employer can refuse a request to take less than 13 weeks Carer s Leave - this must be done in writing and specify the reason for the refusal Although carer s leave is unpaid, employment rights are protected during the leave, meaning the employee s job must be kept open during the leave period To qualify employees must have worked for you for a minimum of 12 months The person in need of care must have been declared as such by a deciding officer of the Department of Social Protection (DSP)
Carer s Leave At least two weeks before the leave, the employer and the employee must prepare and sign a document confirming the agreement for the leave The document must contain certain information and a sample can be found in the document: http://www.workplacerelations.ie/en/publications_forms/guide_to_the_carer s_leave_act.pdf Employees must give you at least 6 weeks notice of their intention to take carer s leave The employer keeps the original and gives a copy to the employee
Carer s Leave Employees may work up to 15 hrs a week during carer s leave The leave agreement is flexible so long as the employer agrees Employees must give at least 6 weeks notice of the leave stating: what date the leave will be taken from; the way leave will be taken and that the DSP have agreed the person needs this care Employees must give 4 weeks notice that they intend to return to work
Carer s Leave Only the first 13 weeks of leave accrue holiday entitlement As long as their income does not exceed the limit set out by the DSP and they inform the DSP before work begins The leave may be postponed, curtailed or varied in how it is taken. If this happens an amended agreement must be completed, signed and a copy given to the employee
Force Majeure Leave
Force Majeure Leave Employees are entitled to paid time off if any of the following become sick or injured: Child or adoptive child Spouse or someone living as husband and wife Someone who the employee is acting as in loco parentis Sibling Parent or grandparent Someone living with the employee who relies on them for care Employees are only entitled to this leave if their presence is indispensable to the person who is sick or injured Employees are entitled to a maximum of 3 days in 12 months, or 5 days in 36 months and part days count as whole days of leave
Force Majeure Leave Employees keep all of their employment rights during this leave, including pay Force Majeure Leave cannot be treated as any other leave As soon as is reasonably practicable after the return to work the employee must confirm they have taken this leave in writing stating: RSI number Name and address of injured or sick person Relationship to employee Nature of illness/injury Dates of leave
Compassionate Leave
Compassionate Leave There are no statutory entitlement to leave if a close family member dies Force Majeure cannot be used for this purpose It is an accepted practice in Ireland to give employees compassionate leave The amount of leave is entirely dependant on the details laid out in the terms and conditions of employment It is usual to give at least the day of the death and a day for the funeral, although some employers give more days, especially if the employee is the next of kin and responsible for organising the funeral and other affairs
ANY OTHER TYPES OF LEAVE
Jury Service
Jury Service Employees who are called for jury service are obliged to attend Employees must be given time off to attend Employees should not lose pay or any other employment rights whilst on jury service Annual leave should accrue during jury service
Useful Links http://www.revenue.ie/en/business/paye/guide/employers-guide-payedefinition.html http://www.citizensinformation.ie/en/employment/employment_rights_and_c onditions/leave_and_holidays/public_holidays_in_ireland.html http://www.workplacerelations.ie/en/publications_forms/guide_to_the_paren tal_leave_acts.pdf http://www.revenue.ie/en/index.html http://www.citizensinformation.ie/en/employment/employment_rights_and_c onditions/contracts_of_employment/contract_of_employment.html www.irishjobs.ie/careeradvice/understanding-your-payslip/ https://geert-hofstede.com/cultural-dimensions.html UK contact for Geert Hofstead info@itim.org
End of Session Please contact the GPA with questions or to leave feedback, which is always welcome 01277 888 760