Statutory Sick Pay – Proposed Changes

Company vs Statutory Sick Pay

Employers that offer at least three days of Company or Occupational Sick Pay do not necessarily have to worry about this change unless the employee has run out of this Company or Occupational Sick Pay benefit.

However, if, like many small and medium-sized businesses, you offer Statutory Sick Pay only, then this change is likely to have an impact on you.

What Are the Proposed Statutory Sick Pay Changes?

The Government is proposing that Statutory Sick Pay is currently paid from day one rather than day four.

This means that even if an employee takes one day off, they will be entitled to Statutory Sick Pay.

The second change is to abolish the lower earnings limit (£118.75 per week from 6th April 2025).

This limit currently means that any employee or worker earning less than this per week is not entitled to Statutory Sick Pay.

However, if the proposals go ahead, all employees will be entitled to the lower of the Statutory Sick Pay weekly rate or 80% of the employee’s average weekly pay.

What Could the Impact Be?

These changes are likely to adversely impact businesses that currently pay lower rates of pay and/or employ many low-hours part-time or zero-hours workers who may not have been entitled to Statutory Sick Pay under the current rules.

The above changes could mean that businesses find themselves dealing with more sickness for shorter periods if the employee deems that they can live on the Statutory Sick Pay rate for a while.

It will also mean that costs are likely to rise for Companies and Organisations that currently only pay Statutory Sick Pay.

Of course, this situation may not materialise, but it would be prudent for companies and organisations to review their current sickness absence strategies, polices and procedures in advance of any changes coming into force.

What Can Businesses Do to Mitigate Any Impact?

There are a number of steps that companies and organisations can implement today to be ready for any future changes in this area. We have given you a few tips below:

• Make sure all employees adhere to the absence reporting procedures at all times;
• If you are concerned about an employee’s absence, then take action quickly;
• Hold Return-to-Work meetings;
• Ask for appointment letters;
• Check with colleagues regarding the employees’ whereabouts;
• Check Social Media;
• Signpost to GP, Qualified Medical Practitioner or support organisations;
• Make sure any absence is dealt with swiftly and decisively;
• Give leeway and show compassion when there is a genuine medical problem that the employee needs to resolve.

HR Smart’s Summary

These new changes to legislation present a challenge to companies and organisations: to keep absence costs to a minimum and prevent workplace disruption.

By taking proactive steps during 2025, employers can ensure that they are fully prepared to manage any changes in Statutory Sick Pay effectively and fairly.

Should you need to contact us for any help or advice in this matter, please email jon@hrsmartuk.com or contact us on 01903 754107.