Statutory Sick Pay

The Lower Earnings Limit and Waiting Days Will No longer Apply To SSP

The Employment Rights Act will remove the ‘lower earnings limit’ and the ‘three waiting days’ as qualifying criteria for payment of Statutory Sick Pay. Meaning all workers will be entitled to Statutory Sick Pay from day one of any period of sickness.

What is the current situation?

SSP is currently paid from the fourth day of sickness absence at a flat weekly rate (£123.25 per week from 6 April 2026, reviewed annually).

To qualify, employees need to be earning more than the Lower Earnings Limit, which is currently £129 a week (from 6 April 2026).

What Is Changing To Statutory Sick Pay

Lower Earnings Limit

Currently employees have to earn at least the Lower Earnings Limit to be eligible to receive SSP when off work sick. Removing the threshold would mean all workers would be qualify for SSP.

The Lower Earnings Limit from April 2026 is £129 per week, based on the 21 and over NMW rate of £12.71 per hour, that means anyone working 10 hours or less per week will now qualify for SSP when they currently would not qualify.

Waiting Days

Employees who qualify for SSP currently receive no pay for the first three days of any absence. The days are known as Waiting Days. Removing the waiting days would mean SSP is payable from the first day of sickness rather the fourth day.

Rate of Payment

The Government have concluded, following consultation in 2024 that those earning below the lower earnings limit will be entitled to receive sick pay at 80% of average weekly earnings. This means that all employees will be entitled to the lower of the SSP weekly flat rate or 80% of average earnings as soon as they are off sick from work.

Consideration was given to increasing the rate of SSP to make it a ‘fair rate of pay’. This hasn’t been done for April 2026 but might happen in 2027 or later.

Paying Statutory Sick Pay Under The New Regime

From April 2026 SSP for an eligible employee will be based on two figures and with the actual payment being the lower of the two:

80% of the employee’s Average Weekly Earnings (AWE)

This is calculated over an eight-week relevant period before the first day of sickness absence

The flat statutory SSP rate

This rate is increased annually and has been set at £123.25 per week from April 6, 2026

If we take an average weekly wage of £154.05 80% would be £123.24, meaning the emloyee would receive the average pay rate as that is lower than £123.25, although by only 1p. Anyone earning an average of £154.06 or higher will receive the flat rate of SSP as 80% of there average pay would be £123.248 which would round up to £123.25.

Worked Examples

Employee earns an average of £200 per week	80% = £160	SSP = £123.25 (flat rate is lower)
Employee earns an average of £135 per week	80% = £108	SSP = £108 (80% is lower than flat rate)

Statutory Sick Pay is paid by the employer through their normal payroll run, subject to usual tax and National Insurance deductions. There is currently no entitlement to reclaim SSP from the Government, although this may change in the future (see the note below).

Linked Absences

Where an employee has linked sickness periods, less than 56 days apart, the Average Weekly Earnings from the initial period of sickness is used for all subsequent linked calculations.

Rounding

Any 80% payments are rounded up to the nearest whole penny.

Statutory Sick Pay Transitional Protections

Eligibility and Transitional Protections have now been confirmed and apply to anyone already off sick on 6 April:

Reimbursement of Statutory Sick Pay Costs
A new clause has been added regarding the SSP rebate scheme which confirms the Secretary of State must establish a scheme for the reimbursement of SSP costs incurred by companies which employ fewer than 250 staff. It is not clear whether this must be established before April 2026 or at a later date.

Date of Implementation

The Employment Rights Bill Delivery Roadmap confirms that the measures will be introduced in April 2026.

Top Tips

Although the measures won’t be introduced until April 2026, you can start to plan now.

Check The Costs: These changes would mean increased costs for employers. Check your absence records to see how many days of absence have been ‘waiting days’. I also recommend you check your payroll system will be able to adjust to the new regime when implemented.

Review Policies: Update your absence policy to reflect the entitlement to SSP from day one of each absence. At the same time check it is still fit for purpose, specifically absence reporting procedures and any triggers for unsatisfactory absence. Paying SSP from day one could result in more short-term absences, so you may need to spend more time managing employees’ attendance. This means that you will need your policies and procedures to be robust and support your business’s aims.

Work With Your Payroll Team/Provider: Work with payroll to adjust the mechanics of paying SSP.

Train Line Managers: Line managers and team leaders will need a refresher on handling short-term absence before the new regime is implemented. Including conducting return-to-work meetings.

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