Assistant Payroll Manager
Payroll Updates: Changes to Statutory Sick Pay (SSP)
- SSP becomes payable from the first day of sickness.
- The Lower Earnings Limit requirement will be removed.
- The statutory weekly rate increases to £123.25.
The UK government has announced plans to change Statutory Sick Pay (SSP) from April 2026. The proposals are part of a wider package to strengthen employee protections and ensure workers get support when they can’t work due to illness. Employers need to get to grips with what’s changing and consider the practical impacts on payroll, sickness management and employment costs.
The upcoming changes focus on three areas: when SSP becomes payable, who qualifies and how much they get. Together, these changes will widen access to SSP and provide more meaningful support, particularly for lower-paid workers.
SSP from the first day of sickness
Currently, employees must wait 3 qualifying days before SSP becomes payable, so payment usually starts on day 4 of their sickness absence. From April 2026, this waiting period will be removed.
SSP will be payable from the first qualifying day of sickness absence if the employee meets the eligibility criteria. This will mean more occasions where SSP is paid, particularly for short-term absences that previously fell within the waiting period.
Removal of the Lower Earnings Limit requirement
Currently, employees must earn at least the Lower Earnings Limit to qualify for SSP. Under the proposed changes, this will no longer apply.
Employees will be entitled to SSP regardless of their earnings level as long as the other qualifying conditions are met. This will extend SSP to a wider group of workers, including part-time and lower-paid staff who may not currently qualify. This will have a bigger impact in sectors with flexible or variable working patterns.
Increase to the SSP rate
The SSP rate will increase to £123.25 per week. While SSP is a statutory minimum, the higher rate is to improve the level of support during illness.
Employers need to factor this into future cost planning, particularly where SSP is paid in addition to or as part of an enhanced contractual sick pay scheme.
New way of calculating SSP
Along with the rate increase, SSP will be calculated differently. Payments will be based on 80% of an employee’s average weekly earnings, subject to a cap at the statutory rate.
This means lower-earning employees will get SSP that better reflects their usual earnings, and higher earners will still be capped at the statutory maximum.
What does this mean for employers?
Taken together, these changes will have operational and financial implications. Employers may see:
- More employees qualify for SSP
- SSP is being paid earlier and more frequently, particularly for short absences
- Higher SSP costs due to expanded eligibility and higher payment levels
- More payroll administration and system changes
- Need to review sickness absence and sick pay policies to make sure they are fit for purpose
Employers with enhanced or contractual sick pay should also consider how these arrangements interact with SSP under the new rules.
Plan ahead
Although the changes won’t come into force until April 2026, early preparation will be key. Employers should start reviewing workforce eligibility, payroll capabilities and sickness absence procedures well in advance.
Clear internal communication will also be important, particularly for employees who will become newly entitled to SSP under the new rules.
Bottom line
The proposed changes are the biggest to Statutory Sick Pay in recent years. While it’s about improving employee protection, the impact on employers should not be underestimated.
By planning ahead, businesses can manage the transition smoothly and avoid disruption when the new rules come into force. Rödl UK can help employers with payroll reviews, policy updates and practical guidance to get compliant and ready for April 2026.