The Trades Union Congress (TUC), the Chartered Institute of Personnel and Development (CIPD), and the Federation of Small Businesses (FSB), are all calling upon the Government for Statutory Sick Pay reform, with some arguing that SSP be increased to a rate that at least matches the National Minimum Wage and the National Living Wage.
Statutory Sick Pay Reform
A recent survey conducted by the CIPD of 1000 employers found that 62% of employers believe that the rate that Statutory Sick Pay (SSP) is currently set too low, and fails to protect the most vulnerable workers, and that Statutory Sick Pay reform is therefore required.
The survey even found that 57% of small and mid-size enterprises (SME’s), who find it more difficult to cover the costs that come with Statutory Sick Pay (SSP), agreed that the rate is too low
The current rate of SSP is £96.35 per week for 28 weeks. It is due to rise to £99.35 per week from the 6th April 2022.
One of the main findings of the CIPD survey is that 17.2% of the workforce, which equates to 5.6 million workers, do not even qualify for SSP, as they earn below the £120.00 per week qualifying threshold or are self-employed
The CIPD recommend that the following changes are made as part of a Statutory Sick Pay reform package:-
- SSP be increased to a rate that at least matches the national minimum wage / national living wage
- Remove the qualifying earnings threshold of £120.00 to widen eligibility
- New measures to protect the self-employed
- New rules to facilitate phased returns to work
- Pay SSP from the first day of sickness by removing the rule that it is only paid once the employee has been off work for 4 days in a row
Coronavirus Statutory Sick Pay Rebate Scheme
Although there is currently no intention on the part of the Government to engage in Statutory Sick Pay reform, during the Covid-19 pandemic it did introduce the Coronavirus Statutory Sick Pay Rebate Scheme (SSPRS), details of which can be found here.
Essentially, under the SSPRS, employers with less than 250 employees are able to claim up to two weeks SSP per employee for Covid-19 related sickness absences
Nevertheless, the SSPRS is only a temporary scheme and the TUC and the FSB are calling for it to be made permanent as part of wider Statutory Sick Pay reform, which would include the removal of the qualifying earnings threshold of £120.00.
As part of their call for Statutory Sick Pay reform, Frances O’Grady, the General Secretary of the TUC, and Martin McTague, the National Vice Chair, Policy and Advocacy at FSB, wrote a joint letter to the Chancellor of the Exchequer, Rishi Sunak.
In the said letter, the TUC and the FSB called for the Government to "create an effective sick pay system to underpin the economic recovery, ensure that all workers that need access to sick pay would receive it regardless of earnings, and make sure that all employers would be able to afford it."
In calling for Statutory Sick Pay reform, the TUC and the FSB argued in the letter that there was a need to take "a fresh look at the issue....[as there was]........a new awareness of the need for people to protect their health at work, and to avoid the spread of respiratory viruses in the workplace". In terms of reform, they highlighted the need to remove the qualifying earnings threshold of £120.00 in order to widen eligibility, and for the rebate scheme to be made permanent and to cover all types of sickness absenses from work.
The FSB also point out that the average cost to a small business last year of sickness absence was just over £3,500.00.
Frances O’Grady also called for SSP to be increased to match the real living wage as part of Statutory Sick Pay reform. She stated: "No one should be forced to choose between doing the right thing and self-isolating or putting food on the table. But millions of low-paid workers have faced this impossible choice."
O'Grady added: "Two years into the pandemic, it’s time ministers stopped turning a blind eye to this obvious problem and fixed our broken sick pay system. Delivering sick pay for all would be an important first step. But with statutory sick pay at a measly £96 a week, we need ministers to increase it to real Living wage too so people can afford to self-isolate."
