Sick Days as an Employee Benefit
Sick days as an employee benefit remains a controversial topic. What are the tax aspects of sick days, how to set them up contractually, and how they are subject to tax and insurance?
Sick days as an employee benefit remains a rather controversial topic. Are sick days a plus or a minus? Do employees use them the way they should?
Sick days, or time off for health reasons, are designed to allow employees to take excused and paid absences due to health issues. Usually, it is 3 - 5 days per year, which are tax-deductible expenses for the employer. However, the condition is that this benefit is agreed upon in a collective agreement, employment contract, or another agreement concluded with the employee, or in the employer's internal regulations.
The wage or wage compensation provided for the days of sick leave is taxed together with the employee's regular wage as income from dependent activity, as this income is not subject to any of the tax exemption clauses. This income is also subject to social security and health insurance contributions.
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