Back on the 21st November 2024, the Government announced that Statutory Sick Pay (SSP) would increase from £116.75 per week to £118.75 per week from the 6th April 2025. At the same time, the average gross weekly earnings required to qualify for SSP will increase from £123.00 or more per week, to 125.00 or more per week.
As part of the reforms being introduced under the Employment Rights Bill, entitlement to SSP will ultimately become a day 1 right (as opposed to having to wait 3 consecutive days at present), the right to SSP will be extended to all workers by removing the lower earnings eligibility threshold, and those receiving SSP will receive the lower of £118.75 per week or 80% of their average weekly earnings
Calls For Increase In SSP
During the consultation on the sick pay reforms, however, some called for an increase in SSP beyond £118.75, arguing that the rate was too low. However, in its response to the consultation, the Government has rejected these calls, stating that it believes that the decision to remove the lower earnings eligibility threshold and to make SSP a day 1 right represent a reasonable compromise between the welfare of workers and business sustainability
Government Response
In its response, the Government stated: "The Government is confident that an 80% rate strikes the right balance between providing financial security to employees who need it, whilst limiting additional costs to businesses. An 80% rate will help protect those on lower incomes from falling into financial hardship and will better enable people to take the time off they need to recover. This can help prevent the spread of infectious diseases, reduce the overall rate of sickness absence, reduce presenteeism and deliver productivity benefits for businesses and the economy."
Comment
Angela Rayner, the Deputy Prime Minister, added: "What we put into our workforce, we get back and more. That’s why we’re making Statutory Sick Pay a right for every worker for the first time so people can stay in work rather than risk dropping out. This is a pro-worker, pro-business government in action – boosting productivity, while ensuring people don’t have to choose between health and wealth, helping deliver our Plan for Change."
Impact Upon Businesses
Whilst these SSP reforms provide important protections for workers, they also create new challenges for employers, especialy small businesses, given the increased costs relating to the measures. Those that cope the best will be those who either already have or are able to now put in place robust absence management policies.
Key elements of a robust absence management policy include the following:-
- Having a clear and detailed absence reporting procedure that requires employees to notify their manager by phone within a specific timeframe, ensuring absences are properly tracked and documented from day one
- Conducting return-to-work interviews after every absence, regardless of duration, to understand underlying causes, identify patterns, and demonstrate the company's proactive approach to attendance management
- Establish trigger points within your absence management policy that automatically initiate formal review meetings when certain thresholds are reached (e.g., 3 instances of absence in 6 months or 10 days total absence in 12 months)
- Invest in occupational health services and employee assistance programs to address health issues early, potentially preventing longer-term absences and supporting faster returns to work
- Maintain detailed absence records and regularly analyse data to identify trends, allowing for targeted interventions and policy adjustments where specific departments or absence types show concerning patterns
Balancing Worker Protection and Business Sustainability
The upcoming changes to Statutory Sick Pay (SSP) represent a significant shift in how the UK approaches employee welfare and business responsibilities. While maintaining the previously announced rate of £118.75 per week, these reforms introduce fundamental changes that will reshape the employer-employee relationship regarding sick leave.
The government's decision to stand firm on the £118.75 rate while expanding access and removing waiting periods strikes a careful balancing act between worker protection and business sustainability. This approach acknowledges the financial pressures faced by businesses, particularly smaller enterprises, while still advancing worker rights through the removal of eligibility thresholds and the introduction of a day-one entitlement.
For businesses to deal effectively with these new regulations, proactive adaptation will be crucial. The implementation of comprehensive absence management policies, investment in occupational health services, and regular monitoring of absence patterns will become increasingly important. These measures, while requiring initial investment and organisational changes, can lead to long-term benefits through improved workforce management.
The success of these reforms will ultimately depend on how effectively businesses can integrate these changes into their operations while maintaining their financial stability. Employers should focus on preparing their systems, policies, and staff for these new requirements, ensuring they can meet their obligations while maintaining operational efficiency.
