The first Monday of Fabruary is often referred to as National Sickie Day, widely cited as the day when UK workers are most likely to call in sick. Whether or not that is true, this year marked the final National Sickie Day under the current legal framework, with changes to sick pay rules coming into force on April 6.
Employment law specialists warn that the cost of sickness absence is set to increase for employers once the reforms take effect. Amendments to the Employment Rights Act will alter how Statutory Sick Pay is applied, expanding eligibility and accelerating payment timelines.
Under the new rules, Statutory Sick Pay will be payable from the first day of illness, removing the existing three-day waiting period. In addition, the Lower Earnings Limit will be abolished, meaning a wider group of workers will qualify for sick pay than before.
Ruth Medlock, Associate and employment expert at Wright, Johnston & Mackenzie LLP, said the implications for employers could be substantial – particularly in sectors already managing high levels of absence.
She said, “After this year, National Sickie Day will never look the same again – it will have an unprecedented impact on employers as it will hit them in the pocket more than ever.”
Impact of Sick Pay Reform on Employers
Recent data shows that sickness absence reached its highest level in fifteen years during the previous year, placing existing strain on organisations. Ruth Medlock said the forthcoming reforms will add further pressure, particularly as more workers become eligible for Statutory Sick Pay.
She said, “Last year sick days hit their highest level in fifteen years, so the impact of employee absences is already providing difficult for employers – and the new reforms will certainly present some new challenges.
“As well as providing earlier access to Statutory Sick Pay, the removal of a lower earnings threshold means many more people will qualify for it – some 1.3million more according to The Department for Work and Pensions. This will cost employers across the UK an estimated £450m extra annually.”
The removal of the earnings threshold is expected to affect industries with higher numbers of part time or casual staff. Hospitality and retail are among the sectors anticipated to feel the impact more acutely, alongside smaller employers with fewer internal resources.
Medlock added, “Some industries which rely heavily on part time or casual workers, or smaller businesses with less resources, may feel the biggest impact. As well as more workers being eligible, there will be a new administrative burden so it is essential to plan ahead, know your obligations and be ready for April 6.”
Planning for Sickness Absence and Workplace Support
Medlock advises employers to review their sickness absence processes ahead of April, emphasising preparation and consistency. She said organisations should ensure managers understand their responsibilities and have the tools to respond appropriately when employees are off sick.
“Examine your approach to sickness absence and make sure you have the right processes and manager training in place to best protect yourself and your employees. An effective return-to-work interview practice helps to reduce unplanned absences while providing meaningful opportunities to assess and support employee wellbeing.
“An appropriate level of communication from managers to employees when they are off sick – with a focus on support and wellbeing – is also encouraged to mitigate risk. Prioritising responsible employment practices will both foster a healthy workplace culture and strengthen the long-term well-being of their workforce.”
With the April 6 deadline only a couple of months away, employers are encouraged to familiarise themselves with the changes and assess how revised sick pay obligations may affect costs, processes and workforce planning in the year ahead.