Major overhaul of Statutory Sick Pay (SSP) to take effect from April

With the changes brought about by the Employment Rights Act 2025 (ERA), the government has implemented significant updates to Statutory Sick Pay (SSP) as part of its far-reaching employment rights agenda.

SSP will be payable from day one

 From April 2026, employees will be entitled to SSP from the first full day of sickness, ending the long‑standing system of three unpaid “waiting days”; under the previous rules, employees only became eligible on the fourth day of absence.

Lower earnings limit removed

The reforms abolish the Lower Earnings Limit (LEL), previously set at £125 per week. This threshold excluded large numbers of part‑time, casual, and low‑paid workers from receiving SSP.

Its removal means all employees, regardless of income level, will now qualify so employers will need to consider that those who traditionally would not have qualified will now do so.

There is a new SSP calculation

SSP will now be calculated using a dual‑rate system. From April 2026, employers must pay whichever is lower of:

• 80% of the employee’s normal weekly earnings, or
• The statutory flat rate, rising to £123.25 per week.

Average weekly earnings will normally be based on the relevant period (the eight weeks preceding the sickness absence).

Transitional protections for employees already on SSP

Employees who are already receiving SSP when the new rules take effect on 6 April will receive full transitional protection; your payroll team should ensure that they understand the position for each individual who is currently absent due to illness, or who becomes so around 06 April.

Creation of the Fair Work Agency

As regards enforcement of the SSP reforms, these will come under the remit of the Fair Work Agency which is due to be created in April, and which will oversee compliance, resolve disputes and streamline enforcement mechanisms within a single national framework.

What this means for employers

Employers will need to prepare for the shift in obligations and administration and should expect potential increases in short‑term absences due to the new access to SSP from day one.

The removal of waiting days, broader eligibility and revised payment calculations will bring with them the requirement to review and consider amendment to:

• payroll systems;
• absence reporting;
• absence management procedures; and
• sickness and attendance policies

As with many of the changes which are imminent in connection with the ERA, line manager training will be critical.

Other April changes

Other April changes to consider are:

• Paternity leave becomes a Day One right (though Paternity Pay is still subject to length of service requirements) and can also be taken more flexibly
• Bereaved Partner’s Paternity Leave becomes a Day One right
• Unpaid parental leave also becomes a Day One right
• Whistleblowing protections apply to sexual harassment disclosures
• Increase in the protective award maximum (payable in circumstances in which employers have failed to follow collective consultation obligations) doubles from 90 days’ pay per employee to 180 days
• The Fair Work Agency is to be created

We will be publishing updates as the legislation beds in and if you would like to discuss these changes, or any others you may be concerned about, do please contact us by calling 01772 258321 and asking to speak to a member of the employment team or by emailing [email protected]

We are working with a number of clients to audit their current ERA position and develop bespoke action plans; if this is of interest to you, please get in touch.