Dáil Éireann Debate, Thursday - 22 October 2015
95. Deputy Michael McGrath asked the Tánaiste and Minister for Social Protection the number of employees whose employers will benefit from the reduced rate of employer's pay-related social insurance introduced in the budget on incomes of €356 to €376 per week; the average benefit the employer will receive; and if she will make a statement on the matter. [36838/15]
View answerFrom 1 January 2016 the upper threshold for paying the 8.5% Class A rate of employer PRSI from will increase from €356 to €376. The increase in this threshold addresses the concerns of the Low Pay Commission when recommending an increase in the adult rate of the National Minimum Wage from €8.65 to €9.15 per hour.
The current minimum hourly wage of €8.65 means that employers pay the lower 8.5% PRSI rate for employees on a 39 hour working week. The increase in the minimum wage to €9.15 increases earnings for a 39 hour week to €356.85, which currently attracts the higher 10.75% employer rate. The Commission was concerned that, without an adjustment in employer PRSI, an increase in the current minimum wage rate will have a major impact, particularly on small business costs.
Increasing the weekly threshold from €356 to €376, will ensure that employers with employees benefitting from the increased minimum wage, will continue to attract the lower 8.5% rate of employer PRSI. In addition, over 26,000 employers currently paying Class A employer PRSI at the higher 10.75% will move to the 8.5% rate of employer contribution.
The benefit for individual employers depends on the level of weekly earnings. The following table details the numbers of employers and the extent of their weekly gains, at different income bands.
|
Weekly Income band |
Number of Employments |
Range of Weekly Gains |
|
356.01-<358 |
4,497 |
€8.01 - €8.06 |
|
358.01-<360 |
2,347 |
€8.06 - €8.10 |
|
360.01-<362 |
2,423 |
€8.10 - €8.15 |
|
362.01-<364 |
2,157 |
€8.15 - €8.19 |
|
364.01-<366 |
2,522 |
€8.19 - €8.24 |
|
366.01-<368 |
2,381 |
€8.24 - €8.28 |
|
368.01-<370 |
2,202 |
€8.28 - €8.33 |
|
370.01-<372 |
2,764 |
€8.33 - €8.37 |
|
372.01-<374 |
2,141 |
€8.37 - €8.42 |
|
374.01-<376 |
2,585 |
€8.42 - €8.46 |
