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Insight
6th April 2026 will see two significant changes to the eligibility and payment of Statutory Sick pay (“SSP”).
Here is an overview of what is changing, what it means and what employers need to do.
As it stands, SSP is paid from the 4th day of sickness (with the first 3 “waiting days” being unpaid).
It is paid at a fixed rate, regardless of income and requires employees to earn at least £125 a week. Employees who earn less that this do not qualify. This is known as the “lower earnings limit”.
The removal of the waiting days means that, for those employers who pay SSP, the cost of absence will increase. Staff who previously would have received nothing will now be able to claim SSP on these days. It seems inevitable that this will make taking time off more likely.
In relation to the removal of the lower earnings limit, those on low wages, part-time contracts, or with irregular hours, who previously didn’t qualify for SSP, will now be eligible. Presumably, this too will lead to increased absence rates as staff use their new entitlement.
The government’s aim is to “safeguard productivity” by persuading those who are unwell to stay at home. This prevents the spread of illness amongst the workforce and allows the individual adequate time to recover thus come back stronger.
The predicted costs to business of the change is £450 million according to the Department for Work and Pensions, but this equates to just £15 per employee.
It is estimated that around one quarter of all UK employees receive SSP. The remaining three quarters are paid contractual sick pay and will be unaffected by the changes. That said, employers will need to review their policies and establish that the changes in respect of SSP do not leave them exposed. For example, a commensurate three day waiting period before full pay kicks in would now have to be paid at SSP rates as a minimum.
For those who pay SSP only, payroll systems will need updating to manage the necessary calculation of someone’s normal pay. Where this falls below the weekly limit (currently £125 per week) they will receive 80% of their normal weekly pay instead. Previously they would have received nothing.
Removal of waiting days and earning limits reduces financial strain on low paid employees, allowing them time off to recover. This should help to control infection and promote employee wellbeing.
Employees living with long term, chronic conditions or who are neurodivergent sometimes need more frequent or unpredictable sick leave. By eliminating the waiting days and scrapping the earnings limit, the system becomes more accessible to these employees.
If you already pack enhanced sick pay beyond statutory minimum rates, and you pay from day one of any absence then the chances are you do not need to do anything. However, earnings should be checked to confirm that the removal of the lower level threshold is not meaning staff go without pay. In addition, any periods of non -payment must reflect the new rules on SSP (i.e the removal of waiting days).
For those that use SSP, you will need to review your contracts, policies, absence management and payroll systems. You also need to train managers and communicate the changes to ensure proper implementation.
Depending on take up, budgeting may be required to absorb the higher costs. Also think about workforce planning and whether staffing levels need to be reviewed, or shifts amended.
Absence management will become more important than ever. Remember that accurate recording is key, and Return to Work interviews are a crucial tool in helping you manage any increase in absence.
Promote employee wellbeing initiatives and remind staff of any support available in helping them to achieve healthier lives.
Remember to keep all records to establish compliance. The new Fair Work Agency will have new powers of inspection and enforcement, including bringing clams on behalf of staff and class actions against employers.
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