The UK Government has announced a significant change to statutory sick pay (SSP), extending coverage to around 1.3 million low-paid workers.
Under the new policy, employees earning less than £123 per week will receive 80 percent of their salary from the first day of sickness. Currently, these workers are not entitled to any SSP, while those earning above this threshold receive £116.75 per week, rising to £118.75 in April.
The change follows discussions between the government and business leaders, resulting in a compromise that requires employers to pay whichever amount is lower under the new scheme. The policy is expected to come into effect next year and will ensure sick pay starts immediately, rather than after the third consecutive day of illness.
Government Emphasises Worker Protections
The government believes the reform will help prevent low-paid workers from falling onto benefits and could leave some up to £100 better off per week by keeping them in employment.
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Work and Pensions Secretary Liz Kendall commented, “For too long, sick workers have had to decide between staying at home and losing a day’s pay, or soldiering on at their own risk just to make ends meet. No one should ever have to choose between their health and earning a living, which is why we are making this landmark change.”
Kendall described the policy as beneficial for both workers and businesses and part of the wider plan to strengthen employment rights.
Day-One Rights
The British Chambers of Commerce (BCC) acknowledged the government’s compromise but expressed concerns about the financial impact on businesses. Jane Gratton, deputy director of public policy at the BCC, noted that the policy would add to the cost pressures employers already face, including those linked to budget measures set to take effect in April.
“Employers often struggle to find shift cover at short notice, leading to disruption for customers,” she said. “The government’s impact assessment did not produce compelling evidence on the day-one rights issue, so there may yet be unforeseen consequences.”
Rachel Suff, wellbeing adviser at the CIPD, welcomed the progress but warned that a minority low earners could be “worse off” under the new rules granting them 80% of their salary. She added that SSP should be reviewed for more flexibility – particularly in the case of employees with fluctuating health conditions.
She said, “More flexibility in how SSP is paid could help support people with phased returns from sick leave, when they may be fit for some work but cannot return to their usual hours. SSP as part of a phased return to work would give people a safety net to return to work, helping them build back up to their usual arrangement while still being able to access financial support for the time they can’t work.”
