Key Takeaways for Employers from Budget 2024
Budget 2024 was delivered on Tuesday, 10 October 2023, with a total package of €12.3 billion being allocated. Some of the measures introduced will take effect before the end of the year, with other measures being introduced on a phased basis throughout 2024. Below are specific provisions which employers should be aware of:
- From August 2024, Parent’s leave and Parent’s benefit is set to be extended by two weeks from seven to nine weeks. This type of leave, entitles each parent to 9 weeks’ leave during the first two years of a child’s life or in the case of adoption, within the first two years of a child’s placement with the family.
- To support those with disabilities in the workplace, the Free Travel scheme has been extended to cover those medically certified unfit to drive.
- The Wage Subsidy Scheme, which provides financial supports to employers who employ those with disabilities, has also a reduction in the minimum hours’ threshold from 21 down to 15 hours.
NATIONAL MINIMUM WAGE
- From 1 January 2024, the new minimum wage will be set at €12.70 per hour. In practical terms, for a full-time employee earning the minimum age, this will result in an approximately €2,300 increase in take-home pay for the employee per annum.
- The standard rate tax band has been increased by €2,000 from €40,000 to €42,000. In addition, individual tax credits are set to increase by €100 to €1,875 for personal, employee and earned income tax credits.
- 1% increase to all employer and employee PRSI contributions from 1 October 2024. There is a recognised need to raise social insurance revenue, but as the government declined to increase the pension age, this year’s Budget has addressed these concerns by increasing PRSI contributions. This move is targeted at ‘the long-term sustainability challenges faced by our pensions system’.
- The government is also set to roll out pension auto-enrolment in 2024 which is something employers need to be cognisant of. This scheme will see employer and employee pension contributions matched on a one-for-one basis, with the state providing up to €1 for every €3 saved. Starting at 1.5% contributions, this is set to rise until it reaches 6% in 2034. Employers must note that this Auto-Enrolment system is an opt-out rather than opt-in system.
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