Several key changes in employment law come into effect that employers need to be aware of. These updates impact employee benefits, pensions, wages, and compliance obligations. Here's a summary of the most critical updates here:

1. Changes to Small Benefit Exemption

The Small Benefit Exemption limit has been increased to €1,500 from 1st January 2025, allowing employers to reward employees with vouchers up to this amount, tax-free. Additionally, the number of benefits allowed under this scheme can now be taken across the year in up to five parts per year. This is an excellent opportunity to provide your employees with tax-efficient benefits.

2.Pension Rules are Changing

Employer contributions to Personal Retirement Savings Accounts (PRSAs): The Finance Bill introduced a new limit in relation to employer contributions to PRSAs and PEEPs. From 1st January 2025, the contribution cannot exceed more than 100% of the relevant employee’s remuneration in the year. Amounts in excess of this will be treated as a taxable BIK (benefit in kind) in the hands of the employee.

Auto-enrolment: This year, pension rules will significantly change, with new auto-enrolment requirements due to come into force on the 30th of September 2025. It's important to familiarise yourself with these changes and to ensure your systems are adjusted so you are fully prepared for the new pension landscape. Link to changes here

3. Minimum Wage Increase from January: The national minimum wage will increase to €13.50 per hour on January 1st.   It's crucial to adjust your payroll systems to reflect this change.

4. Penalties for Non-Compliance with Employer Reporting Requirements: We anticipate that employer reporting requirements will be stricter this year, and penalties for non-compliance will likely be increasingly enforced. To avoid these penalties, ensure your payroll systems are up-to-date and fully compliant.

5. Gender Pay Reporting

From 1st January 2025, Ireland's Gender Pay Gap Reporting Requirements will expand to include employers with 50 or more employees. This is part of the phased implementation under the Gender Pay Gap Information Act 2021, which aims to promote pay transparency and address wage disparities across organisations.

6. Statutory Sick Pay (SSP)

From 1st January, employees are now entitled to 7 days sick pay. By way of a reminder, SSP is paid at the rate of 70% of an employee’s normal salary up to €110 per day of absence. An employee must provide a medical certificate in order to qualify for SSP and must have 13 weeks’ service.