Why Employers Could Face Higher Costs from Day One
Changes to Statutory Sick Pay (SSP) came into force on 6 April 2026, bringing with them one of the most significant reforms to sickness absence rules in recent years.
For many employers, the practical impact is likely to be felt quickly, particularly where there are large part-time workforces, variable hours arrangements or frequent short-term absences.
What Is Changing with Statutory Sick Pay in 2026?
There are three key changes to SSP from 6 April 2026:
- SSP is now payable from the first day of sickness absence, removing the previous three-day waiting period.
- The lower earnings limit has been removed, meaning employees can qualify for SSP regardless of how much they earn, provided they meet the other eligibility requirements.
- SSP is now calculated as the lower of:
- the statutory weekly rate (£123.25 for 2026/27); or
- 80% of the employee’s normal weekly earnings.
These changes mean that more employees are likely to qualify for SSP, and payments may start earlier than many employers are used to.
Why Does This Matter for Employers?
For businesses, these changes are likely to have both cost and administrative implications.
Paying SSP from day one means employers may see an increase in absence-related costs, particularly where there are regular short-term absences.
The removal of the lower earnings threshold also means SSP will apply to a wider group of employees, including some who may not previously have qualified.
There may also be a practical impact on payroll and HR systems. Employers will need to ensure that payroll processes can calculate 80% of normal weekly earnings accurately and apply the correct statutory cap.
This may be particularly important for employers with:
- Part-time or low-hours employees
- Variable pay arrangements
- Casual or seasonal workers
- Outsourced payroll providers
- Multiple payroll systems across the business
Handled properly, these changes should be manageable. However, reviewing processes early can help avoid confusion and reduce the risk of mistakes.
What Should Employers Do Now?
1. Review Sickness and Absence Policies
A sensible starting point is to review sickness absence policies, staff handbooks and manager guidance to ensure they reflect the new day-one entitlement and updated calculation method.
2. Check Payroll Systems
Employers should speak with payroll providers or internal payroll teams to confirm:
- Waiting days have been removed
- The new SSP calculation is working correctly
- Variable pay arrangements are being assessed accurately
- Payslips and payroll records remain compliant
3. Train Managers and HR Teams
Managers are often the first point of contact when an employee reports sickness absence.
It is important they understand:
- That SSP now starts earlier
- That more employees are likely to qualify
- How to manage short-term absence consistently
- When further HR or legal advice may be needed
4. Communicate the Changes to Employees
Issuing a short update to employees can help avoid confusion and ensure everyone understands the new entitlement.
This can be particularly helpful where employees may previously have assumed they did not qualify for SSP because of their earnings level.
5. Take Advice on More Complex Situations
Some situations may require more detailed consideration, particularly where there are:
- Employees with fluctuating earnings
- Absences spanning April 2026
- Complex contractual sick pay arrangements
- Ongoing absence management issues
Taking advice early can help ensure your processes remain clear, compliant and proportionate.
Speak to Our Employment Team
If you would like support reviewing your sickness absence policies, updating handbooks or understanding how these changes affect your business, our Employment Law team can help you approach the changes with confidence and clarity.
