Policy lead CIPP
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Not the right time for sick pay system overhaul

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Samantha Johnson, policy lead at the CIPP, discusses the government’s conclusion that SSP should remain unchanged for the foreseeable future.

8th Sep 2021
Policy lead CIPP
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At the risk of losing the audience by starting with the punchline, “now is not the right time to introduce changes to the sick pay system.” 

The 2019 consultation, Health is everyone’s business, provided an exciting opportunity to reform a payment which has remained largely the same for more than a decade. Yet the response published in July 2019 stifled any impending change to the scheme.

Pandemic shone a light on SSP

Statutory sick pay (SSP) was introduced in 1983, and since this time employers have had an obligation to pay a minimum rate of sick pay to their employees (based on certain qualifying criteria). Whilst some changes have occurred in recent years, most notably the abolition of the percentage threshold scheme in 2014, SSP has not evolved in line with attitudes and behaviours towards sickness in the workplace. 

SSP has formed a significant part of the Covid support measures implemented to help employees and business throughout the pandemic. The report goes so far to describe that “the pandemic has shone a light on the importance of SSP”.

The government introduced the removal of waiting days for employees who were absent for Covid-related reasons, alongside the SSP rebate scheme for employers with less than 250 staff.  However, it is inevitable that these measures are a temporary change and appear to have had little impact on the government’s intention to review SSP as a whole. 

SSP will remain unchanged

The government response document discusses the significant public support to remove the lower earnings limit (LEL) as the qualifying threshold for SSP. It also describes the benefit of making SSP more flexible by allowing an employee on a phased return to work to continue to receive some form of payment. Regardless of these promising acknowledgements, the report concludes with the disappointing message that SSP will remain unchanged for the foreseeable future.

In 2018, in the UK, 1.4m working-age people had at least one 4-week (or more) sickness absence. That figure equates to around one in 10 working-age people. A reduction in hours is often recognised as one of the most suitable ways to conduct a phased return, allowing employees to slowly reintroduce work into their routine following long-term absence.

Yet, the opportunity to make significant change to SSP and adopt an approach that would provide financial encouragement, and not a financial deterrent, seems to have now passed by. It will be up to employers to utilise their occupational sick pay schemes to entice employees back to the workplace on a phased basis.

Beyond SSP

Health is everyone’s business did have a wider remit than SSP. The consultation looked at disability and the workplace, and how the government could achieve its goal to see one million more disabled people in work by 2027. An emphasis was placed on employer investment in health and wellbeing as well as supporting small and medium sized enterprises (SMEs) and the self-employed to have access to occupational health schemes. 

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Replies (2)

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By Hugo Fair
09th Sep 2021 12:26

"It will be up to employers to utilise their occupational sick pay schemes to entice employees back to the workplace on a phased basis" ... which was almost certainly the govt's objective (i.e. let SSP wither away - it's almost dead and pointless already)!

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By Freddo
09th Sep 2021 14:37

I believe that it is unfair that the self employed cannot claim SSP. They used to be able to claim it as a non means-tested benefit as long as their NI contributions were up to date. Since the introduction of Universal Credit all benefits are means tested and the self employed cannot claim SSP. This seems unfair if someone has worked all their adult lives, paid Class 2 and Class 4 contributions every year and then cannot claim SSP because someone else in the household is earning. Should something be introduced for the self employed?

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