Statutory sick pay (SSP) is failing to provide enough support for
those who most need financial help when ill and should be
increased and made more widely available, MPs say today.
The report from the Work and Pensions Committee
says that a modest increase to SSP in line with Statutory
Maternity Pay would strike a reasonable balance between providing
extra financial support and not placing excessive extra costs on
businesses. It also says that all employees should be eligible
for SSP, not just those earning above the lower earnings limit.
Rates of sickness absence and ill health have increased in recent
years, with a record 185.6 million working days lost to sickness
or injury in 2022. During its inquiry, the Committee heard the
current system of SSP was an insufficient safety net for those
who relied on it, and no use at all to those who were not
eligible.
Despite consultations by previous governments, no permanent
changes have been forthcoming. While the Committee understands
why the Government decided that the Covid-19 pandemic was the
wrong time to introduce changes, due to the immediate additional
costs on employers, it finds that this argument is now less
valid.
In addition to recommending changes to the SSP rate and
eligibility, the report calls on the Government to amend
legislation to enable SSP to be paid in combination with usual
wages in order to encourage phased returns to work.
On the cost to businesses, the report concludes that the overall
impact of SSP reform is difficult to predict, but even if they
did not result in lower levels of sickness absence, larger firms
would be able to absorb the costs. It says this would not be true
of smaller businesses, however, and calls on the Government to
consult with small and medium-sized businesses on the design of a
small business rebate for SSP.
Finally, the report says that the Government should establish a
contributory sick pay scheme for the self-employed to increase
support during periods of illness.
Rt Hon Sir MP, Chair of the Work and
Pensions Committee, said:
“Statutory sick pay is failing in its primary purpose to act as a
safety net for workers who most need financial help during
illness. With the country continuing to face high rates of
sickness absence, the Government can no longer afford to keep
kicking the can down the road on reform. The Committee’s
proposals strike the right balance between widening and
strengthening support and not placing excessive burdens on
business.
“A growing number of workers are now classified as self-employed
and a new contributory sick pay scheme for self-employed people
would be a welcome step towards ensuring they are they are no
worse off financially during periods of sickness than employees
on SSP.”
A full list of the Committee’s conclusions and recommendations is
available on Pages 34–36 of the report.
