When running an SME the question of whether or not an employee has a right to sick pay and how much sick pay they are entitled to can be confusing. In this short article, we provide a snapshot of the law around sick pay. If you have additional questions, our Employment Law Solicitors will be happy to help you further.
Check your employment contract
Your employees’ sick pay entitlements will be set out in their employment contracts. You are entitled to pay more than the statutory sick pay (SSP) entitlement (see below) and if this is the case the amount and length of time the payment will be made must be set out in the agreement.
If there is no mention of additional sick pay entitlement in the employment contract you must check whether you need to pay an absent employee SSP.
Understanding statutory sick pay
The SSP scheme entitles eligible employees who are absent from work due to incapacity to be paid a set amount (currently £96.35 per week) for up to 28 weeks.
SSP is taxable and subject to national insurance contributions (NICs) and any other deductions normally made from the employee’s pay. As it is put in HMRC's Employer Help-book for Statutory Sick Pay:
"You treat SSP just like pay, so you must make deductions for PAYE and NICs. Any other deductions which you lawfully make from pay can also be made from SSP, for example, pension contributions, Student Loan deductions and attachment of earnings orders." (Page 29.)
All employees and workers who are eligible for Class 1 NIC are eligible for SSP. Other criteria which must be met include:
the employee must have done some work for you
the employee must earn an average of at least £120 per week
they must have been sick or self-isolating for a minimum of four days in a row (this includes non-working days)
You need to obtain evidence of the employee’s incapacity to work. This can be in the form of either:
a signed statement provided by the employee giving a reason for their illness and the dates they are absent from work
in the case of long-term sickness absence a ‘Statement of Fitness for Work’ or ‘fit note’ from a healthcare professional will be required
Employers cannot demand a doctor’s certificate until the employee has been absent for seven days or more.
Sick pay entitlement can be complicated, especially in cases where the employee is absent for elective treatment such as cosmetic surgery. If you are unsure of any aspect of SSP talk to an experienced Employment Law Solicitor.
Get legal assistance from LawBite
Sick leave can be a costly problem, especially when you are not sure what your obligations about sick pay are. If you’re struggling to get your head around how much you need to pay employees that are off sick and for how long, we’ve got you covered.