Statutory Sick Pay changes from April 2026: What employers need to know

Coming into force on 6 April 2026, changes to SSP will likely affect every employer in the UK, but the impact will be felt most acutely by small and medium-sized businesses, particularly those employing part-time, low-paid, or casual workers.

What are the changes to SSP?

1. SSP will become a ‘day one’ entitlement

From 6 April 2026, the waiting period will be removed and SSP will be payable from the first qualifying day of sickness absence.

For employers, this means:

• any qualifying sickness absence will trigger an SSP payment immediately
• short absences that previously did not attract SSP will now result in a payment
• absence reporting procedures may need tightening to ensure sickness is recorded promptly.

2. The Lower Earnings Limit will be removed

The earnings threshold that was previously used to assess if an employee qualified for SSP will be removed, meaning all eligible employees will be entitled to SSP regardless of income.

This change will extend coverage to many workers who were previously excluded, including part-time staff, lower-paid employees and some casual or variable-hours workers.

Estimates suggest around 1.3 million additional workers may become eligible for SSP because of this change [1].

3. A revised SSP calculation

SSP will be paid at the lower of:

• 80% of the employee’s average weekly earnings, or
• the statutory weekly rate, which will rise to £123.25 per week for the 2026/27 tax year.

This is a shift from the flat-rate system and is intended to ensure sick pay better reflects an employee’s actual income while still capping employer liability.

4. Phased returns to work

This is a change that many employers may not have considered. Under current rules, SSP only becomes payable from the fourth consecutive day of sickness absence - the first three days are unpaid waiting days. In practice, this means that employees on a phased return will often not qualify for SSP on their days off, because the pattern of part-time attendance typically breaks the run of consecutive sick days needed to maintain entitlement.

From April 2026, this changes. Because waiting days are removed and incapacity is assessed on a day-by-day basis, SSP will be payable for each day an employee is absent due to sickness during a phased return - even if they are attending work on other days. For example, an employee who normally works five days a week but returns on three days a week following a period of illness would be entitled to SSP for the two days they are not yet able to attend.

5. Transitional protections for ongoing absences

Employees who were already receiving SSP before 6 April 2026 and who would receive a lower amount under the new rules (because 80% of their average weekly earnings is less than the previous flat rate) will be protected by transitional arrangements.

These employees will continue to receive the updated flat rate of £123.25 until:

• they either return to work; or
• they exhaust their 28-week SSP entitlement; or
• their contract ends; or
• they begin receiving statutory maternity pay or maternity allowance.

Employees who are currently serving their waiting days on 6 April will become entitled to SSP from that date. Employees earning below the current LEL who are off sick on or after 6 April will become eligible for SSP under the new rules.

6. Fair Work Agency enforcement

April 2026 also sees the establishment of the Fair Work Agency (FWA), a new enforcement body created under the Employment Rights Act 2025. Once operational, the FWA will have powers to enforce SSP payments - meaning non-compliance will carry greater risk than it does today.

Employers should ensure that their payroll processes are accurate and that SSP is being paid correctly and promptly.

What does this mean for employers?

While the policy intention is to improve financial security for workers, employers should be aware of several practical implications.

Increased SSP costs

Two aspects of the reform may increase employer costs.

• Paying SSP from day one rather than day four.
• More employees becoming eligible for SSP due to the removal of the earnings threshold.

Employers should assess the financial impact of these changes. The government estimates the reforms will cost employers approximately £450 million annually - around £15 per employee [1].

Policy and payroll updates

Employers should review their existing documentation and systems to ensure they reflect the new rules. In particular:

• employee handbook and sickness absence policies referencing waiting days may need updating.
• employment contracts should be reviewed for outdated SSP wording
• payroll systems will need to calculate SSP under the new rules.

Absence reporting procedures

Employers should consider their approach to short-term absence management. Without the deterrent of unpaid waiting days, they may wish to strengthen their absence management procedures or consider an Employee Assistance Programme (EAP).

Training line managers on the updated rules, especially around phased returns and what triggers SSP entitlement, is also recommended.

Final thoughts

The April 2026 SSP reforms represent one of the most significant changes to the UK sick pay framework in decades. By introducing day-one entitlement and expanding eligibility, the government aims to provide greater financial security for workers when they are unwell.

For employers, however, the reforms also mean higher compliance requirements, potential cost increases, and the need to update policies and payroll processes.

Preparing now will help ensure businesses remain compliant while continuing to manage absence effectively.

Frequently Asked Questions

Do the new SSP rules apply to all employers, regardless of size?

Yes. The changes apply to all UK employers. However, the impact will be felt most by small and medium-sized businesses, particularly those with part-time, low-paid, or variable-hours staff.

How do I calculate 80% of an employee’s average weekly earnings?

Average weekly earnings (AWE) are typically calculated using the employee’s earnings in the eight weeks prior to the first day of sickness. Your payroll software should be updated to handle this automatically - if you’re unsure, speak to your payroll provider or take specialist advice.

What if an employee earns more than £123.25 per week - does the flat rate still apply?

Yes. SSP from 6 April is always paid at the lower of 80% of AWE or £123.25 per week. So higher earners will receive the flat rate, while lower earners receive the earnings-based amount.

Will I need to update employment contracts?

Any contracts referencing waiting days or the Lower Earnings Limit should be reviewed and updated to reflect the new rules.

What happens if an employee is already off sick when the changes come into force?

Transitional protections apply - covered in detail in section 5 above.

Will employees have to prove their sickness if SSP is now due from day one?

The rules around self-certification for the first week of sickness absence remain the same. The only change is that SSP is now payable from day one.

In respect of the SSP change, does the employee still have to be off for the 4 days to be eligible for SSP payment from day one?**

No, the waiting days will not apply anymore. Eligibility will be from day one of sickness absence even if the absence lasts for less than 4 days.

What is the Fair Work Agency and should I be concerned?

The Fair Work Agency (FWA) is a new enforcement body with powers to pursue SSP non-compliance. Its creation signals that the government intends to take enforcement more seriously - so accurate payroll records and prompt SSP payments will be essential going forward.

Can an employer insist an employee provide a fit note from a doctor when they are claiming SSP?

No, an employee can self-certify for the first 7 calendar days of sickness. Thereafter a fit note is required if the employee remains unwell.

This article is intended for informational purposes only and does not constitute legal advice. The information is accurate at the time of writing but may be subject to change. For advice specific to your situation, please consult a qualified professional.

[1] UK Government, Employment Rights Act 2025 Economic Analysis, January 2026. Available at: https://assets.publishing.service.gov.uk/media/695d3ebfbd1c076f787e7399/employment-rights-act-2025-economic-analysis.pdf