Statutory sick pay changed in April — what small employers now pay

For most of the last forty years, short sickness absence cost a small employer nothing in statutory terms. The first three days of any absence were unpaid waiting days, and since the overwhelming majority of absences are one to three days, statutory sick pay was something you read about rather than something you paid.

That ended on 6 April 2026. Two changes under the Employment Rights Act 2025 came into force together, and between them they turn SSP from a rare cost into a routine one.

What actually changed

The three waiting days are abolished. Statutory sick pay is now payable from the first qualifying day of sickness, not the fourth.

The lower earnings limit is abolished too. Previously an employee had to earn at least the LEL on average to qualify at all, which excluded a large number of part-time and low-paid staff. That test is gone, so essentially every employee on your payroll is now eligible.

And the amount is calculated differently. SSP is the lower of 80% of the employee's average weekly earnings or the flat statutory rate, which is £123.25 a week for 2026/27. The 80% test means the lowest-paid staff who have just been brought into scope receive a proportion of their normal pay rather than more than they usually earn.

The 28-week maximum for any one period of sickness, or a linked series of them, is unchanged.

The numbers, on a real payroll

Take three employees.

A full-timer earning £620 a week: 80% is £496, so the flat rate is lower and they get £123.25 a week. If they work five qualifying days, that is £24.65 a day.

A part-timer earning £280 a week: 80% is £224, still above the flat rate, so again £123.25 a week.

A weekend-only member of staff earning £140 a week: 80% is £112, which is below the flat rate, so they get £112. Before April they would have got nothing at all, because they fell under the earnings limit.

Now the change that actually hits the bank account. A two-day absence used to cost £0 in SSP. It now costs about £49.30 for the full-timer. Across a team of eight averaging five sick days each in a year, that is roughly 40 days at £24.65 — about £986 a year of cost that simply did not exist before, and almost all of it in short absences you never used to pay for.

The headline of this reform is a rate rise. The cost of it is the waiting days, because short absences are the ones that actually happen — and they were the ones that used to be free.

You cannot claim any of it back

This catches people out every year. There is no reimbursement scheme. The Percentage Threshold Scheme, which let small employers recover SSP above a threshold, was abolished in 2014 and nothing replaced it. Statutory sick pay is a straight cost to the business, deductible against profits like any other wage cost, and that is the end of it.

Which makes the budgeting point simple: this is now a permanent line in your staff cost model, and if you are pricing work on a labour cost per hour, the number moved in April.

Contractual sick pay is a separate decision

SSP is the floor, not the ceiling. Plenty of small employers offer contractual sick pay — full pay for a set number of days a year — and there is nothing wrong with that. But three things are worth being deliberate about now that the floor has risen.

Write it down, and write down whether it is discretionary. A practice of paying full pay for two weeks, repeated often enough without being documented, can become an implied contractual term you cannot then withdraw.

Set a qualifying period if you want one. Offering contractual sick pay from day one of employment is a choice, not an obligation.

And keep it consistent between people doing the same job, because inconsistency here is one of the more common routes into a discrimination claim.

Evidence, records and the process

Employees can self-certify for the first seven calendar days of absence. After that you can reasonably ask for a fit note from a GP or other eligible healthcare professional. You cannot insist on a fit note for a two-day absence, and asking for one is a good way to generate a grievance rather than reduce absence.

Keep records of absence dates and SSP paid. HMRC can ask to see them and, more usefully, you cannot manage a pattern you have not recorded.

Then separate the two things that get muddled: paying sick pay correctly is a payroll obligation, and managing an absence problem is a management task with its own process. Managing staff sickness absence properly is where return-to-work conversations, trigger points and occupational health belong — none of which have anything to do with what SSP you are legally required to pay.

What to do this month

Check your payroll software is applying day-one SSP and the 80% cap correctly, particularly for anyone who was previously below the earnings limit — that group is the most likely to be mishandled, because they were invisible to the old rules.

Reforecast your staff costs with a realistic absence assumption rather than zero. Check your contracts and handbook still describe what you actually do; an employee handbook nobody has updated is worse than not having one, because it is evidence of a promise you may no longer be keeping.

And if you employ people on irregular hours, work out now how you will calculate average weekly earnings for them, rather than the first morning one of them calls in sick.

Common questions

How much is statutory sick pay in 2026/27?

Statutory sick pay is the lower of 80% of the employee's average weekly earnings or the flat statutory rate of £123.25 a week for 2026/27. For most employees the flat rate is the lower figure and therefore what they receive — an employee earning £620 a week gets £123.25, which across five qualifying days is £24.65 a day. For lower earners the 80% test bites instead: someone earning £140 a week receives £112. SSP is payable for a maximum of 28 weeks in any one period of sickness or linked series of periods, and it is paid through payroll subject to tax and National Insurance like normal wages.

Are there still three waiting days before SSP starts?

No. The three unpaid waiting days were abolished from 6 April 2026 under the Employment Rights Act 2025, and statutory sick pay is now payable from the first qualifying day of sickness. This is the change with the real cost attached, because short absences of one to three days are by far the most common and used to cost an employer nothing in SSP. The same reform removed the lower earnings limit, so part-time and low-paid employees who previously did not qualify at all are now eligible. Payroll software needs checking on both points, especially for previously ineligible staff.

Can I reclaim statutory sick pay from HMRC?

No. There is no reimbursement scheme for statutory sick pay. The Percentage Threshold Scheme, which allowed small employers to recover SSP costs above a threshold, was abolished in 2014 and has not been replaced, so SSP is funded entirely by the employer. It is deductible against profits as an ordinary employment cost, but that is the only relief available. Since the April 2026 changes removed waiting days and the earnings threshold, this is now a recurring cost rather than a rare one, and it belongs in your staff cost model and in any hourly rate you calculate for pricing work.

When can I ask an employee for a fit note?

Employees can self-certify for the first seven calendar days of absence, counting all days rather than working days. From the eighth day you can reasonably ask for a fit note from a GP or another eligible healthcare professional, such as a nurse, pharmacist, physiotherapist or occupational therapist. You cannot require medical evidence for a short absence, and demanding it tends to produce a grievance rather than better attendance. Keep your own record of absence dates and SSP paid — HMRC can ask to see them, and you cannot manage an attendance pattern you have not been recording in the first place.