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Hi AmsterdamSqn,
Welcome to the community.
Have you tried the basics, such as restarting the handset? If so you could try clearing the Phone Data.
Menu > Settings > Apps > All > Phone > Clear Data
Note this will remove data from within the phone app, such as call log lists. You can use the Backup & restore function within the handset first before trying this,
Let us now how you get on.
You might want to repair the phone with PCC
Bridge (for Mac)
Alternatives on How to backup Xperias
http://talk.sonymobile.com/thread/36355
You could try disabling notifications and then re enabling them.
Menu > Settings > Apps > Phone > Untick notifications > Then re tick Notifications.
Let us know if this helps.
I too have this problem with my Z1 Compact running Lollipop. The settings sequence described above is not available - there's no option re Notifications in the menu. Only way to clear the notification icon is to restart the phone.
Any help would be appreciated.