The Government is currently in consultation on ways to reform the current SSP rules with the expectancy of reducing employee job losses due to ill health. The proposals put forward so far are also looking at providing both employers and employees with earlier access to support from occupational health and financial advice services to ensure that both employers are supporting their employees in returning to work after a period of ill health, and try and keep those with longer term health conditions from falling out of work in the first place.
The biggest changes so far put forward will benefit both parties. For employees, the current qualifying threshold is £118 and the new proposals are set to lower this – allowing many more people to access SSP whose earnings are currently below this amount. The other main change is to allow a rebate to employers that actively support their employees in returning to the workforce following an illness. These reformations together will allow for a further 2 million employees on lower incomes to access SSP and overall allow for better control for employers.
So what are the current rules?
SSP is paid in accordance with the rules set out by HMRC under the SSP Regs 1982, and is at present set at the rate of £94.25 per week and paid for the days that an employee would normally work (these are called qualifying days). It is also paid in the same way as normal wages – i.e. on the same day and including the deduction of income tax and NI contributions. To qualify for SSP an employee must:
- Have been sick for 4 days in a row, SSP is not started until the fourth consecutive day of illness. The three days prior to this are known as waiting days.
- Have a contract of employment under which they have done some work.
- Earn an average of £118 per week.
- Give you the correct notice of absence.
- Provide evidence of their illness after 7 days off (the first 7 days can be covered by self-certification).
One of the areas that causes the biggest concerns to both employer and employees is the way in which SSP is counted during a phased return to work. Due to the requirement that SSP does not get paid for at least 4 consecutive days of absence, and in conjunction with the further rule that "you cannot count a day as a sick day if an employee has worked for a minute or more before they go home sick" (SSP Regs 1982: reg 2) many people are confused with present regulations on how, or whether, to pay SSP to employees requiring a gradual return to work. This can create unnecessary stress on employees worrying about the financial implications of losing SSP when we would be hoping everyone involved should be focused on a clear and stress-free route back into the workplace. In fact, the Government has theorised that over 100,000 people have left their jobs after a period of ill health lasting over a month. The consultation process is also allowing the Government to allow for phased returns where the employee keeps their SSP entitlement until they are back to full employment.
The consultation is also looking at offering rebates to employers that actively help their staff return to work. Up to now the Percentage Threshold Scheme (PTS) has allowed for employers to reclaim SSP in certain scenarios. However, this was decided to be abolished as mentioned in the SSP (Maintenance of Records) (Revocation) Regulations 2014 due to the Government agreeing that "the PTS should be abolished because it provides a disincentive to employers by providing compensation for sickness absence rather than supporting them to actively manage sickness absence in the work place."This has left small businesses struggling with the costs involved in paying their staff, so the consideration of revoking this would have a big impact on these employers. The consultation closed on 7th October 2019 and the outcome could well involve major changes in the rules and regulations surrounding SSP, which will hopefully be a very positive change for both businesses and staff alike.