Thursday, 15 July 2021
Department of Public Expenditure and Reform
Public Sector Staff
173. To ask the Minister for Public Expenditure and Reform if compensation payments are made to retiring civil servants in respect of untaken annual leave in accordance with the Organisation of Working Time Act 1997; and if in each case such payments are treated as ex-gratia payments, free of PAYE deductions and so on. [38887/21]
As per section 24 of Circular 27/2003 - Annual Leave, under the Organisation of Working Time Act 1997, it is illegal to pay an allowance in lieu of the minimum statutory annual leave entitlement of an officer unless the employment relationship is terminated, in which case the officer is entitled to payment for untaken annual leave accrued at the date of cessation of employment either by way of resignation, retirement or the death in service of the officer concerned.
In addition, Section 5 of Circular 10/2012 - Resignations and Retirements Notice Periodinstructs that every effort should be made to ensure that officers are facilitated in taking any annual leave entitlement (including carryover leave) in advance of their resignation/retirement date. The circular further notes that untaken leave may be taken as part of the overall notice requirement and that payment in lieu of annual leave should only be allowed in very exceptional cases.
Payment in respect of each day of untaken annual leave is subject to PAYE, PRSI and USC.