Global Leave Programs Have Myriad Employer Duties

Around the world, employees’ entitlements to absence from work go far beyond sick days and can extend into multiyear leave periods with accompanying requirements for the employer in the areas of pay and otherwise, a global payroll consultant said May 13.

Sick leave programs can include waiting periods before an employee receives pay and a requirement to provide a doctor’s certificate to the employer, said Tim Kelsey, MCIPP, managing director of Kelsey’s Payroll Services. “The day-one countries, that is a problem,” he said, referring to countries where a certificate is required from the first day of absence.

Kelsey used Ireland as an example where a certificate is required from day one to qualify for sick pay but “lots of people don’t bother” getting one, as the maximum sick pay of 110 euros (US$128.02) per day is not much more than the cost of going to the doctor.

Employers may have to report employees’ sick leave, including the reasons for it, in payroll submissions, and cases of work-related or commuting injuries or accidents may cross the line into workers’ compensation, Kelsey said.

Changes to the UK’s Statutory Sick Pay that took effect April 6 removed the previous three-day waiting period before an employee can receive pay, Kelsey said. Unlike other UK leave payments, employers are entirely responsible for paying SSP at the current maximum rate of 123.25 pounds (US$165.13) per week and cannot be reimbursed by His Majesty’s Revenue and Customs, nor will employers receive any assistance for complying with the recent changes, Kelsey said.

Kelsey described France’s sick leave as “a hugely generous sick pay scheme to monitor,” as employees can receive partial pay from the employer for up to three years, which can only be partially reimbursed by the government. Medical certificates are required after three days and can indicate whether an employee is allowed to leave their house and what activities they may be prohibited from doing, Kelsey said. The relevant health insurance provider also calls the employee’s residence twice a day during the hours of 9 to 11 a.m. and 2 to 4 p.m. to ensure the employee is there unless they have an appointment, Kelsey said.

The Netherlands requires employers to pay partial pay to employees on sick leave for up to two years with no reimbursement unless the illness relates to pregnancy, Kelsey said. The employer must work with the employment agency UWV and the employee to create a return-to-work plan for any illnesses longer than four weeks, he said.

“You need a specialist to do this, either a company doctor or outsource it to a specialist occupational health company,” Kelsey said of the return-to-work plans. “There is no good just paying lip service to this, because they will check your efforts” and noncompliant employers may have to pay up to another year of sick pay, Kelsey said.

Kelsey spoke at PayrollOrg’s 44th Payroll Congress in Nashville, Tennessee.

Maternity, Paternity Leave

Kelsey warned that “maternity leave” may only refer to an entitlement to leave immediately before and after the birth of a child, as opposed to parental leave, which is a longer period of up to three years in parts of Europe, Kelsey said. “Do remember that mum may not be back for a very long time,” he said.

Kelsey distinguished between state-provided maternity benefits and “occupational maternity pay” provided by an employer. He again used Ireland as an example, where the 26-week entitlement to maternity leave comes with a benefit of 299 euros per week but no pay required from the employer. The maternity benefit is subject to income tax, but not the Universal Social Charge or Pay-Related Social Insurance, Kelsey said. He suggested that an employer providing full maternity pay to an employee could gross up the maternity benefit to include USC and PRSI and subtract that amount from the employee’s pay, still providing full pay but saving employer social taxes on the part replaced by the maternity benefit.

Jurisdictions such as Poland may increase the amount of leave given for multiple births, Kelsey said. He added that surrogacy is often treated the same as maternity leave, but recommended checking, and that adoption leave may be slightly different than maternity leave.

Additionally, in the European Union, employees on maternity leave must continue to receive all benefits of their employment contract besides pay, and there are often protections against dismissal, Kelsey said. “It is a very foolhardy thing to dismiss a mum who is on maternity leave anywhere in the world, I would suggest,” he said. “If you can at all avoid it, avoid it.”

Paternity leave is becoming more common across the world but may include requirements for the father. In Malaysia, for example, the father must be married to the mother, Kelsey said. Conversely, elsewhere the “father” may not even have to be a man or the biological father of the child in order to be eligible, he said.

Kelsey recommended that employers entering a new country find out whether family leave payments are reimbursable by the government and whether the full amount is reimbursed.

Other types of leave that employees may be entitled to include force majeure leave for unexpected family circumstances, leave for victims of domestic violence, and leave for marriage or blood donation, Kelsey said.