TL;DR: Key Takeaways for Employers
- SSP Rate 2026/27: Employees can receive £118.75 per week for up to 28 weeks, paid by their employer.
- Eligibility: Employees must earn at least £125 per week (the Lower Earnings Limit) and be sick for at least 4 consecutive days.
- Waiting Days: SSP is not payable for the first 3 'waiting days' of sickness absence (for absences starting before April 6, 2026).
- Upcoming Changes (April 2026): The SSP rate will increase to £123.25 (or 80% of average weekly earnings, whichever is lower), and waiting days will be abolished, making SSP payable from day one.
Introduction to Statutory Sick Pay (SSP)
Statutory Sick Pay (SSP) is a crucial element of employee welfare in the UK, providing a minimum level of financial support for employees who are unable to work due to illness. As an employer, understanding your obligations and the intricacies of SSP is vital for compliance and maintaining a fair workplace. This comprehensive guide will walk you through everything you need to know about SSP for the 2025/2026 tax year, including eligibility, payment rates, and the significant changes coming into effect from April 2026.
Navigating sick pay regulations can be complex, but with the right knowledge, you can ensure your payroll processes are accurate and compliant.
What is Statutory Sick Pay (SSP)?
SSP is the minimum amount of sick pay that employers are legally required to pay eligible employees who are off work due to illness. It is paid for up to 28 weeks in any period of sickness. It's important to distinguish SSP from contractual sick pay, which some employers offer as an enhanced benefit. Contractual sick pay schemes must be at least as generous as SSP.
Key Principle:
SSP is a statutory minimum. Employers can choose to offer more generous sick pay schemes, but they cannot offer less than the statutory amount or impose stricter eligibility criteria.
SSP Rate and Duration for 2025/2026
For the 2025/2026 tax year (starting 6 April 2025 and ending 5 April 2026), the standard weekly rate for Statutory Sick Pay is £118.75 [1]. This rate applies to all eligible employees, regardless of their earnings, provided they meet the minimum earnings threshold. SSP can be paid for a maximum of 28 weeks in any single period of sickness absence or series of linked absences.
Important Note on Daily Rates:
While the weekly rate is fixed, the actual amount paid per day (the daily rate) depends on the number of 'qualifying days' an employee works each week. Qualifying days are typically the days an employee normally works.
Calculating Daily SSP Rates (2025/2026)
To calculate the daily rate of SSP, divide the weekly rate by the number of qualifying days in that week. Here's a table illustrating the unrounded daily rates for different numbers of qualifying days:
| Number of Qualifying Days per Week | Unrounded Daily SSP Rate (2025/2026) |
|---|---|
| 7 | £16.9642 |
| 6 | £19.7916 |
| 5 | £23.75 |
| 4 | £29.6875 |
| 3 | £39.5833 |
| 2 | £59.375 |
| 1 | £118.75 |
Who Qualifies for SSP? Eligibility Criteria
For an employee to be eligible for SSP, they must meet several conditions. These criteria ensure that SSP is provided to those who genuinely need it and are part of the workforce.
- They must be classed as an employee and have done some work for you under their contract.
- They must have been sick for at least 4 days in a row (including non-working days). These are known as a Period of Incapacity for Work (PIW).
- They must earn at least the Lower Earnings Limit (LEL) for National Insurance purposes. For 2025/2026, this is £125 per week [1].
- They must give you notice of their sickness, usually within your company's time limit or within 7 days if you don't have one.
- They must provide proof of illness if they're off sick for more than 7 days (including non-working days). This is typically a 'fit note' from a doctor.
Linked Periods of Sickness:
If an employee has more than one period of sickness absence, they are 'linked' if they last 4 or more days each and are 8 weeks or less apart. If linked, they are treated as one PIW for SSP purposes, affecting waiting days and the 28-week maximum.
Waiting Days: When SSP Kicks In
For sickness absences starting before 6 April 2026, SSP is not paid for the first 3 'waiting days' of a Period of Incapacity for Work (PIW) [2]. This means SSP typically starts from the fourth qualifying day of absence. If an employee has linked periods of sickness, they only serve waiting days once for the entire linked period.
Crucial Change Alert:
As of 6 April 2026, waiting days will be abolished, and SSP will be payable from the first day of sickness absence. This is a significant change employers must prepare for.
When SSP Ends and What Happens Next
SSP payments will stop when an employee:
- Returns to work.
- Reaches the maximum of 28 weeks of SSP.
- Their employment ends.
- They are no longer sick.
If an employee is still unwell after 28 weeks of SSP, or if they are not eligible for SSP, they may be able to claim Employment and Support Allowance (ESA). As an employer, you should provide them with an SSP1 form (or your own equivalent) within 7 days of their SSP ending or within 7 days of them reaching 28 weeks of SSP, whichever is earlier. This form allows them to apply for ESA.
Processing SSP in Payroll Software
Modern payroll software significantly simplifies the process of calculating and administering SSP. Most reputable software packages are updated annually to reflect the latest SSP rates and rules. Here's a general overview of how it works:
- Record Sickness Absence: Input the dates of your employee's sickness absence into the payroll system.
- Identify Qualifying Days: The software will typically identify the employee's qualifying days based on their work pattern.
- Apply Waiting Days: For absences before April 2026, the software will automatically apply the 3 waiting days.
- Calculate SSP: The system calculates the correct daily and weekly SSP amounts based on the statutory rate and the employee's qualifying days.
- Integrate with Payroll: SSP is then integrated into the employee's regular pay, with deductions for tax and National Insurance applied as usual.
- Generate Reports: Payroll software can generate reports for record-keeping and HMRC submissions, detailing SSP payments made.
Software Recommendations:
Leading UK payroll software providers like Sage, Xero, and QuickBooks Online offer robust SSP calculation features, ensuring compliance and reducing administrative burden. Always ensure your software is up-to-date.
Fit Notes and the Return to Work Process
For absences lasting more than 7 days, employees must provide a 'fit note' (formerly known as a sick note) from a doctor or other healthcare professional. The fit note advises whether an employee is 'not fit for work' or 'may be fit for work' with some adjustments.
- 'Not fit for work': The employee should remain off work.
- 'May be fit for work': The healthcare professional suggests changes that could help the employee return to work, such as altered hours, different duties, or workplace adaptations. Employers should discuss these with the employee.
Upon an employee's return to work, it's good practice to conduct a 'return to work' interview. This helps to check on their well-being, discuss any ongoing health concerns, and ensure they are fit to resume their duties. It also provides an opportunity to discuss any adjustments recommended on a fit note.
Record-Keeping Requirements
HMRC requires employers to keep accurate records of all SSP payments. While you no longer need to send SSP records to HMRC, you must keep them for at least three years after the end of the tax year they relate to. Essential records include:
- Dates of sickness absence.
- Dates SSP was paid.
- The amount of SSP paid.
- Any SSP that was not paid and why (e.g., waiting days, not eligible).
- Copies of fit notes or self-certification forms.
Digital Records:
Most modern payroll software will automatically maintain these records for you, simplifying compliance. Ensure your system is backed up regularly.
Upcoming Changes from April 2026: A New Era for SSP
The UK government is implementing significant reforms to SSP from 6 April 2026, which will fundamentally alter how employers manage sick pay. These changes are part of the Employment Rights Act 2025 and aim to simplify the system and provide earlier support to employees [3].
Key Changes:
- Abolition of Waiting Days: SSP will be payable from the first day of sickness absence, removing the current 3 waiting days.
- New SSP Rate Calculation: The weekly SSP rate will increase to £123.25 or 80% of the employee's average weekly earnings (AWE), whichever is lower [3]. This is a move away from a flat rate for all.
- Removal of the Lower Earnings Limit (LEL): The requirement for employees to earn at least the LEL to qualify for SSP will be removed. This means more employees will be eligible for SSP [3].
Action Required:
Employers must review their payroll systems and policies to ensure they are ready for these changes by April 2026. This includes updating payroll software, communicating changes to employees, and potentially revising contractual sick pay schemes.
Impact of New SSP Rate (from April 2026)
The introduction of the 80% AWE rule means that employees with lower average weekly earnings will receive SSP closer to their actual pay, while those with higher earnings will receive the flat rate. This table illustrates how the new rate will apply:
| Employee's Average Weekly Earnings (AWE) | SSP Rate Payable (from April 2026) |
|---|---|
| Below £154.06 (approx. 80% of £192.57) | 80% of AWE |
| £154.06 or above | £123.25 |
*Note: The exact threshold where 80% AWE overtakes the flat rate is approximately £154.06 (80% of £154.06 is £123.25). Employees earning below this will receive 80% of their AWE, while those earning above will receive the flat rate of £123.25.
Pros and Cons of SSP for Employers
Advantages
- Employee Support: Provides a safety net for employees during illness, fostering loyalty and reducing financial stress.
- Reduced Absenteeism (Long-term): By supporting employees during short-term illness, it can prevent minor issues from escalating into longer absences.
- Clear Guidelines: Statutory nature provides clear rules for employers to follow, ensuring fairness and consistency.
- Payroll Software Integration: Modern payroll systems automate much of the calculation and administration, simplifying compliance.
Disadvantages
- Cost Burden: Employers bear the full cost of SSP, which can be significant for small businesses with frequent or long-term absences.
- Administrative Overhead: Despite software, managing sick leave, fit notes, and compliance still requires administrative effort.
- Complexity of Rules: The rules around qualifying days, linked periods, and average weekly earnings can be complex to interpret manually.
- Impact of 2026 Changes: The abolition of waiting days and the new 80% AWE rule may increase costs and require significant system updates for some employers.
Conclusion
Statutory Sick Pay is a fundamental aspect of employment law in the UK, designed to protect employees during periods of illness. For employers, understanding the current rules for 2025/2026, as well as preparing for the significant changes coming in April 2026, is paramount. By accurately calculating SSP, maintaining diligent records, and utilizing efficient payroll software, businesses can ensure compliance and support their workforce effectively.
Staying informed about legislative updates and adapting your internal processes will be key to navigating the evolving landscape of sick pay in the UK. For further assistance, always refer to official HMRC guidance or consult with a payroll professional.
References
Ready to Simplify Your Payroll?
Compare leading accounting software solutions to find the perfect fit for your business needs.
Compare All Software →