Changes to Statutory Sick Pay are on the horizon, with confirmed increase in payment rates from April 2025 and proposed reforms that could sick pay more accessible for low wage workers. While the Statutory Sick Pay rate increase is set in stone, other key updates are still under discussion and may not come into force until later in the year.
Whether you’re an employee wanting to know what support is available or an employer preparing for payroll updates, here’s what you need to know about the upcoming and proposed changes to Statutory Sick Pay.
What Are the Current Statutory Sick Pay Rules?
Statutory Sick Pay is the minimum amount employers must pay eligible employees when they are unable to work due to illness. Under the existing system, employees must earn at least £123 per week (the Lower Earnings Limit) to qualify for Statutory Sick Pay, which is paid at a flat rate of £116.75 per week. This structure excludes many low-income workers from receiving sick pay, leaving them financially vulnerable when unable to work due to illness.
What Are the Confirmed Changes Effective April 2025?
Increased Statutory Sick Pay Rate
The weekly Statutory Sick Pay rate will rise from £116.75 to £118.75. This increase ensues that employees who qualify for Statutory Sick Pay receive a slightly higher level of financial support while off work due to illness. Employers will need to adjust their payroll systems accordingly to reflect this change from April onwards.
What Are the Proposed Changes Awaiting Confirmation?
The government has also proposed significant reforms to make Statutory Sick Pay more accessible, but these are not yet confirmed. These include:
No More Earnings Threshold
Previously, employees had to earn at least £123 per week to qualify for Statutory Sick Pay. However, this requirement will be removed, meaning that 1.3 million low-wage workers who were previously ineligible will now qualify. This change is particularly beneficial for part-time workers and those in casual employment who previously missed out on Statutory Sick Pay due to their lower earnings.
Earnings-Linked Sick Pay Rate for Low Earners
Employees who earn less than £118.75 per week will now receive 80% of their average weekly earnings instead of the standard Statutory Sick Pay rate. This means Statutory Sick Pay will now be more proportionate to a worker’s actual income.
These changes mark a significant shift in employment rights and sick pay accessibility, helping ensure that more workers receive financial support when they need it most. If you’re an employer, now is the time to review your policies and payroll procedures to stay compliant. If you’re an employee, understanding these updates will help you better plan for any time off due to illness.
Since these proposed changes are not yet law, employers and employees should monitor updates closely to ensure they are prepared for any confirmed implementation dates.
Who Will Benefit from These Changes?
These changes to Statutory Sick Pay will particularly benefit low-income workers, including part-time employees and those on zero-hours contracts, who were previously excluded due to the earnings threshold. By removing the minimum earnings requirement, more workers will now have access to essential financial support when they are unable to work due to illness.
What Do Employers Need to Do?
For employers, these reforms mean updating payroll systems to reflect the new Statutory Sick Pay rate and ensuring that all eligible employees, regardless of their earnings, receive Statutory Sick Pay. Employers should also review their sick pay policies to align with the new earnings-linked Statutory Sick Pay system for lower-paid staff, ensuring compliance and fairness in their workplace policies.
Contact Us Today
Employment law is constantly changing. As in most years, many changes to Employment Law will affect many employees and workers. Macks Solicitors advise clients on all aspects of employment law, for a free initial assessment of your case call 01642 843 670.
