Employment Rights Bill: Changes to statutory sick pay

As part of the all new Employment Rights Bill, it’s likely that changes to statutory sick pay could significantly impact you and your business.

When the Employment Rights Bill becomes law, one of the major changes to affect employers will be the day one right for employees to be paid statutory sick pay (SSP) from the first day of sickness absence.

This important change – which is anticipated to come into force in April 2026, though yet to be confirmed – will have significant implications for which employers should start preparing now.

In addition to the removal of the three-day waiting period to qualify for SSP, all employees – regardless of how little they work or earn – will qualify to be paid 80% of their salary up to a cap of £118.75. This will create an additional financial burden for employers dealing with short-term sickness absences, particularly in respect of employees who repeatedly take single days off sick.

If an employer provides enhanced sick pay – which works in line with the provisions of SSP – it will need to be reviewed to avoid employees becoming entitled to receive full pay from day one without any need for a contractual change.

The impact of the ban on fire and re-hire on the changes to SSP

If the employee has a contractual right to enhanced sick pay, and you need to change it because it will mean a day one right to the enhanced payment if it runs in line with SSP, you will need to consult with the employee before making any changes.

When the Employment Rights Bill becomes law, the practice of fire and re-hire will be outlawed. Any dismissal that takes place with a view to re-hiring on new terms will be automatically unfair.

What should you do?

In anticipation of the changes, employers should:

• update sickness absence policies
• consider updating any enhanced sick pay schemes before the legislation comes into effect
• start monitoring absence patterns to ensure return-to-work processes are fit for purpose and understood
• train line managers to manage short term sickness absence, capability issues and absence management.

We will be covering each new change following the Employment Rights Bill, looking into the details of what could impact you and your business. Keep an eye out on our website and across our social media as we publish our full set of informative articles that will help you understand the changes employers are about to face.

If you have any questions or need assistance preparing for the new Employment Rights Bill, be sure to get in touch – our expert team will be willing to help.

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