Statutory Sick Pay Reforms Explained: Essential Insights for Employers

The Employment Rights Act 2025 brings major changes. One of them relates to Statutory Sick Pay (SSP) that employers must prepare for. From 6 April 2026, the way SSP is calculated, who qualifies, and when payments begin will change significantly. These reforms will affect payroll systems, absence management, and overall employer costs.

Payroll manager checking absence records for SSP compliance

Removal of Waiting Days Means SSP Starts Immediately

Currently, SSP payments only begin after three 'waiting days' of sickness absence. This means employees do not receive SSP for the first three days they are off work due to illness. From April 2026, this waiting period will be removed. Employees will be entitled to SSP from the first day of sickness absence.

Expanded Eligibility Covers All Employees

Another significant reform is the removal of the lower earnings limit for SSP eligibility. At present, employees must earn above a certain threshold to qualify for SSP. From April 2026, all employees (including part-time workers, casual or temporary staff) will be eligible for SSP regardless of their earnings.

So a part-time worker earning below the current threshold who previously did not qualify for SSP will now receive it from day one of sickness absence.

New Calculation Method Adds Complexity

The way SSP is calculated will also change. Instead of a fixed weekly rate, SSP will be the lower of:

• 80% of the employee’s normal weekly earnings, or

• The statutory flat rate, set at £123.25 per week from 6 April 2026

  
  

How this works in practice:

• An employee earning £100 per week will receive 80% of £100 = £80, which is less than £123.25, so SSP will be £80.

• An employee earning £200 per week will receive 80% of £200 = £160, which is more than £123.25, so SSP will be capped at £123.25.