Sickness Absence Management

Managing sick pay for employees can be a challenging area for many employers. Outsourcing payroll to a payroll and HR provider like PayEscape ensures compliance with legal obligations while maintaining employee welfare.

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What is Statutory Sick Pay (SSP)
What is Statutory Sick Pay (SSP)?

Statutory Sick Pay (SSP) is the minimum amount employers are legally required to pay eligible employees who are off work due to illness. SSP applies to most employees who meet the eligibility criteria, and it is a set amount paid for up to 28 weeks.

How Much is Statutory Sick Pay Per Week
How Much is Statutory Sick Pay Per Week?

As of the current tax year, the rate for statutory sick pay is £109.40 per week. Employers must pay this to eligible employees who have been off sick for more than four consecutive days, including non-working days (also known as “qualifying days”).

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Cloud-based payroll software operates by utilising cloud computing technology, which means that the software and data are stored on remote servers and accessed via the internet.

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Eligibility for Statutory Sick Pay (SSP)

To qualify for SSP your employees must meet the following conditions:

  • Earn at least £123 per week (before tax and National Insurance)
  • Have been ill for at least four consecutive days (including non-working days)
  • Be classed as an employee and have done some work for you
  • Inform you of their illness within your stated deadline (or within seven days if no deadline exists)

SSP does not apply to certain categories, including the self-employed, employees who have recently left employment, and those who have already received the maximum SSP entitlement.

If your Employee is Not Eligible for SSP

If your employee does not meet the eligibility criteria for SSP, you are required to provide them with an SSP1 form. This form explains why they are not entitled to SSP and allows them to claim other benefits, such as Universal Credit or Employment and Support Allowance (ESA). This should be issued within seven days of the employee’s sick leave.

If Sickness is Caused by Work

If your employee’s illness is caused by work-related activities, such as an accident or injury sustained on the job, they may still qualify for SSP. However, if the illness is significant and leads to long-term absence, employees may also be eligible to claim Industrial Injuries Disablement Benefit (IIDB). You must follow all relevant health and safety regulations to avoid workplace illness and accidents, ensuring you provide adequate support for employees who become unwell due to work. Speak with a HR consultant at PayEscape to ensure your health and safety regulations are up to date.

SSP for Irregular Hours and Part-Year Workers

Employees who work irregular hours, including part-time and zero-hours contracts, can still qualify for SSP. The amount they earn and how frequently they work will be considered when determining their eligibility. If the employee earns an average of at least £123 per week over an eight-week period before falling ill, they will be entitled to SSP. It’s important to note that SSP only covers working days, and if an employee is sick on days they wouldn’t have worked, these days won’t count towards SSP entitlement.

If your Employee is Sick on Holiday

If your employee falls ill whilst on holiday, they are entitled to claim SSP rather than using their holiday entitlement. In this case, they must inform you of their illness and provide the necessary medical evidence, such as a doctor’s note. The employee can choose to reschedule their holiday and use the sick leave instead.

If Employee Sick Pay Runs Out

Statutory Sick Pay is paid for a maximum of 28 weeks. If an employee remains unfit for work beyond this period, they may need to claim additional benefits, such as Employment and Support Allowance (ESA). You should inform employees when their SSP is about to end and provide them with an SSP1 form, which allows them to apply for further support.

Keeping Sick Pay Records

You will need to keep records if your employee if off to calculate sick pay. For example ff your employee works five days a week, £109.40 ÷ 5 = £21.88 per day. For three days of sickness, the employee would receive £21.88 × 3 = £65.64.

It’s important to keep accurate records of:

  • Periods of sickness lasting four or more days
  • The SSP payments made to employees
  • Any relevant medical certificates

Calculating and Recording SSP

Calculating SSP involves ensuring that the employee has met the eligibility requirements and determining their qualifying days. Qualifying days are the employee’s normal working days, and SSP is only paid for these. SSP calculations can be managed by a payroll provider like PayEscape. Calculating SSP includes:

1

Determine the Qualifying Days:

SSP is only paid for qualifying days, which are the days an employee usually works. For instance, if an employee works Monday to Wednesday, their qualifying days are Monday, Tuesday, and Wednesday.
2

Check the Four-Day Rule:

SSP is payable after the first three days of sickness, known as waiting days. If an employee has been off for four consecutive days (including weekends), they become eligible for SSP from day four.
3

Calculate the SSP Rate:

The SSP rate is £109.40 per week as of 2024. If the employee only qualifies for part of a week, you will need to prorate this amount. For example, if the employee is sick for three qualifying days, divide £109.40 by the number of qualifying days in a week, then multiply by the number of sick days.
4

Paying SSP

You must pay SSP in the same way you pay regular wages. The SSP amount should be recorded on the employee’s payslip, and normal tax and National Insurance deductions will apply. Payroll solutions include SSP management and will automatically calculate the correct payment amounts, ensuring compliance with SSP regulations. Get in touch with a payroll provider online today.
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Claiming Back SSP

The SSP Rebate Scheme, which previously allowed small and medium-sized businesses to claim back SSP paid to employees, ended in 2021. Currently, employers are required to cover the cost of SSP themselves.

Company Sick Pay Schemes

Many employers offer additional sick pay, known as company sick pay, which can be more generous than SSP. These schemes vary by business, but often provide full pay for a set period (e.g. four weeks) and may reduce to half pay after that. It’s important to outline your company’s sick pay scheme clearly in your employee contracts or handbook. How typical company schemes work:

Full Pay for a Limited Period

Some companies offer full pay for a certain number of sick days, after which the employee reverts to SSP.

Percentage of Salary

Other businesses may pay a percentage of the employee’s salary, such as 50% pay for the first month of sickness.

Capped Pay

Some companies cap the total amount of sick pay an employee can receive, regardless of the length of their absence.

How Integrated Payroll and HR Software Can Help

PayEscape’s integrated payroll and HR software simplifies this process. With automated statutory calculations, easy record-keeping, and compliance management, our platform ensures that you stay on top of SSP payments, holiday entitlements, and employee absences. Take control of your business with PayEscape – the trusted payroll and HR software solution for UK employers. Our software allows for:

Automatic calculation of SSP and other entitlements
Accurate record-keeping of sickness periods and payments
Compliance with HMRC reporting requirements
Integration with HR for seamless management of absences, payroll, and holidays

Payroll Services

Using our cloud-based software we manage all aspects of your payroll process. From calculating your payroll taxes and filing with HMRC to managing all components of auto enrolment and so much more. Whether it’s reimbursement or pre-tax benefits we’ve got it covered.

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Our HR platform lets you manage all aspects of your HR administration. With HR Escape can approve and monitor holiday, record working time and calculate wages, allocate time and staff expenses to clients, projects, and activities, and much more.

Time Tracking Software

Our software powered by UKG includes the latest technology and tools to keep your employee time and attendance streamlined and simple. Coupled with powerful reporting tools it greatly enhances your management analysis while minimising overpayments and compliance risk.

Book your free demo now.

Need help to understand what solution is best for your business? Speak with our expert team today on 028 2764 1060

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