HR · 10 September 2020

Do I have to provide statutory sick pay as a small business owner?  

Statutory sick pay: Young woman with fever wrapped up in scarf to stay warm
Statutory sick pay is first paid after three waiting days, meaning workers don’t receive SSP until day four of sickness

Writing for Business Advice, Associate Director of Advisory at leading HR consultancy Peninsula, Kate Palmer, looks into the rules surrounding statutory sick pay and what first-time employers need to know.

This article was originally published on 24 October 2016. We have since included information for employers on statutory sick pay and coronavirus.

What is Statutory Sick Pay?

Statutory Sick Pay (SSP) is a statutory payment available for eligible employees who are unable to work due to sickness.

Who has to pay it?

Small business employers do not have a choice over whether they pay SSP – so long as an employee is eligible they are legally entitled to receive SSP.

Since 2014, employers are no longer able to reclaim the costs of SSP from the government and have to absorb these costs themselves.

Who is entitled to SSP?

Entitlement to SSP depends on whether the employee is eligible for the statutory payment. To qualify for SSP the individual must fall within the definition of an employee which is, generally, someone employed under a contract of service.

There are extensions to this definition to cover other categories of worker, including apprentices and some agency workers.

When do I have to start paying statutory sick pay?

The individual must have been off sick for a period of four or more consecutive days, including non-working days, to be classed as a “period of incapacity for work”.

The employee must also have told the employer about their absence in line with any company absence reporting requirements and have supplied evidence of their illness.

This is usually a self-certificate, for absences less than seven days long, or a fit note from the employee’s doctor if the illness has lasted for seven days or more. Additionally, the employee must have earned the current Lower Earnings Limit of at least £120 a week.

How much is SSP?

The government sets the amount of SSP payable to eligible employees and this is currently £95.85 per week. SSP is paid to the employee once they have served three waiting days, meaning they don’t receive SSP for the first three days of sickness which fall on their normal working days.

Once served, SSP is paid for every day the employee would normally work but are unable to because of their illness. If the employee returns to work, but then goes off again sick within eight weeks of their original sickness, these two sickness periods are linked.

The employee does not have to serve three waiting days for the second period and SSP is payable from the first working day of their absence from work. If eight weeks and a day has passed since the first period of sickness, the employee has to serve an additional three waiting days at the start of the second sickness.

What is the maximum SSP entitlement?

The employee has a maximum entitlement of 28 weeks of SSP so, once the entitlement has been used, SSP is not payable for further periods of sickness. Employers don’t have to pay SSP for any day where the employee has come in and carried out some work before going off sick – even if the work is only for a minute.

There are also special rules regarding payment for sickness during maternity leave, where the employee is on strike on the first day of sickness and where they are working outside of the EU.

Employers can choose to offer more favourable terms to sick employees than those offered by the statutory scheme. Though this may be viewed as an additional expense which is not necessary, a financial incentive is likely to improve employee engagement and retention and could, in turn, reduce staffing costs and turnover.

If a contractual sick pay scheme is offered, the scheme needs to contain details such as the duration of the contractual entitlement to sick pay and the amount that will be paid, for example, if this is full pay for three months or half pay for three months and then SSP for the remainder of the sickness period.

Kate Palmer is Associate Director of Advisory at Peninsula.

Statutory Sick Pay and the coronavirus

As of 13 March 2020, employees and workers who self-isolate must receive any Statutory Sick Pay (SSP) due to them from the first day they’re absent from work if it’s because:

  • they have coronavirus (COVID-19)
  • they have coronavirus symptoms, for example a high temperature, a new continuous cough or a loss of, or change in, sense of smell or taste
  • someone in their household has coronavirus symptoms
  • they’ve been advised to stay at home by their doctor because of an underlying health condition
  • they’ve been told to self-isolate by a doctor or NHS 111
  • they’ve been told to self-isolate by a government ‘test and trace’ service, because they’ve been in close contact with someone who tested positive (‘NHS Test and Trace’ in England, ‘Test and Protect’ in Scotland or ‘Test, trace, protect’ in Wales)
To be eligible for SSP, employees and workers must be off work for at least 4 days in a row, including non-working days like the weekend or bank holidays.

Some employers can claim back up to 2 weeks’ SSP they’ve paid to anyone because of coronavirus. Find out more about claiming back SSP due to coronavirus on GOV.UK

If an employee or worker cannot work, they should tell their employer as soon as possible, outlining the reason and how long they are likely to need time off.

Testing positive for the coronavirus

If your staff has symptoms or has tested positive for coronavirus, they must self-isolate at home for a minimum of 10 days, while others in their household need to follow suit for 14 days.

If a government ‘test and trace’ service tells someone they’ve been in close recent contact with someone who has tested positive, they must self-isolate for 14 days. If they develop symptoms, everyone else in their household must self-isolate for 14 days.

For more information about test and trace:

Asking for ‘proof’

If your staff are self-isolating, they still need to adhere to your usual absence reporting protocol. =

Employees can ‘self-certify’ for the first 7 days off work if they have symptoms or test positive for the coronavirus.

In this case, employees will need to inform the workplace and apply for sick leave as they usually would, without the need for a medical note.

Those self-isolating due to coronavirus for more than 7 days can get an online self-isolation note from the NHS website or NHS mobile phone app if they are registered with a GP in England.

It’s a good idea to create or amend your workplace’s policy on absence from work at this time. Consider being flexible when asking for medical proof as your employee may be too sick to get a medical note immediately.

Self-isolating after returning to the UK

Employees or workers are not entitled to SSP if they’re self-isolating after returning from holiday or business travel and they cannot work from home. However, they may be entitled to SSP if they have coronavirus symptoms upon their return.

An employer can choose to pay the employee an amount equivalent to SSP, or a higher amount of pay if they want to.

Find out more about holiday and leave during coronavirus.

For more about self-isolation rules when returning to the UK in:

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ABOUT THE EXPERT

Kate Palmer CIPD is the head of advisory at law firm Peninsula and is a member of its senior leadership team. She joined in 2009 having held a senior HR manager's role in another large company. With a specialist background in facilities management in the NHS, Kate offers a wealth of employment law experience. She's an expert negotiator - one notable case was with the NHS's trade unions over terms and conditions in the Agenda for Change pay system.

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