Legal Bitesize October 2025

Statutory Sick Pay (SSP): Current Position, Changes under the ERB and FAQs

Current Legal Framework

Statutory Sick Pay (SSP) is the minimum statutory payment an employee is entitled to when unable to work due to illness. Broadly, under the current framework, to qualify for SSP, an individual must:

• Be classed as an employee and have performed some work under their contract;
• Have average weekly earnings at or above the Lower Earnings Limit (currently £125 per week); and
• Have been absent from work due to illness for at least four consecutive days (including weekends and holidays).

Please note that, for the purposes of SSP, the definition of ‘employees’ includes agency workers engaged on contracts for services.

Employees meeting these conditions are entitled to receive SSP from the fourth qualifying day of absence (the first three days being the ‘waiting days’), for up to 28 weeks in any period of incapacity (or linked periods) for work. From 6^th April 2025, that flat rate of SSP increased to £118.75 per week, up from £116.75, in line with inflation.

Further details are available on the REC Legal Guide on SSP.

Proposed Reforms under ERB: How will it work?

The Employment Rights Bill (ERB), which is currently in the final stages of the parliamentary process, introduces significant changes to SSP designed to increase access and fairness. The Bill is expected to receive Royal Assent any day now. Following this, we are expecting consultations to be launched, one of which should cover the changes to SSP.

The measures proposed in the Bill include:

• Removal of the Lower Earnings Limit, making SSP available to all employees regardless of income.
• Revised payment structure, so that SSP is paid at 80% of an employee’s weekly earnings or £118.75 per week, whichever is lower.
• Abolition of the ‘waiting days’ rule, meaning employees will be entitled to SSP from day one of absence, rather than the fourth.
• Transfer of enforcement responsibility to the Fair Work Agency, which will oversee SSP enforcement and dispute resolution and should be in place from April 2026. The FWA will have the power to recover underpayments of SSP as well as their costs in taking enforcement action.

These reforms aim to ensure that lower-paid workers can take necessary sick leave without undue financial hardship. Removing the earnings threshold would extend SSP eligibility to an estimated 1.3 million additional workers, including agency workers.

We have received several questions on the legal helpline regarding how this will be applied to agency workers. The government has yet to clarify the specifics of how this will apply to agency workers, such as what counts as “day one” and how average earnings will be calculated.

Next Steps?

These reforms will be implemented through secondary legislation and are due to come into force in April 2026 in accordance with the current timeline for implementation.

The changes will apply to England, Wales and Scotland. Subject to the approval of a Legislative Consent Motion by the Northern Ireland Assembly, the changes will also be introduced in Northern Ireland.

How should employers best prepare for the changes?

• Businesses should incorporate the changes into their strategic plans and budgets, preparing to implement the necessary updates to their payroll systems, to ensure that the correct rate of SSP is paid to all eligible employees, and to ensure that employees are paid SSP when they should be.
• While not required by law, many employers offer enhanced or occupational sick pay schemes. Employers should review these arrangements to ensure they align with the revised statutory framework and consider whether any contractual terms need updating to reflect the new SSP rules.
• Employers should review, and if necessary, amend, their sickness/absence policies to ensure that they align and are compliant with the new law. We would recommend ensuring your contracts with clients allow you to recover this cost.

We would recommend staying up to date on our ERB Hub.