Statutory Sick Pay Changes from April 2026 – What Employers Need to Know

From 6 April 2026, significant changes to Statutory Sick Pay (SSP) will take effect under the Employment Rights Act 2025. These reforms are substantial. They widen eligibility, change how SSP is calculated, and for many employers they are likely to increase overall cost, particularly where there are part-time, lower-paid, or zero-hour workers in the workforce.

At a practical level, the changes are designed to bring more employees into the SSP system and adjust how payments are determined. For employers, this means both financial and administrative impact, so understanding the detail early is important.

One of the most notable changes is the removal of the Lower Earnings Limit. At present, employees must earn at least the Lower Earnings Limit to qualify for SSP. From April 2026, that earnings threshold disappears entirely. Employees earning below the previous limit will now qualify, which means more part-time and zero-hour workers will become eligible. For many businesses, this alone is likely to increase the number of SSP claims they see.

Another major change is the removal of waiting days. Under current rules, SSP is only payable from the fourth qualifying day of sickness absence, after three waiting days. From April 2026, those waiting days are abolished. SSP will be payable from the first qualifying day of absence. This is expected to increase SSP costs, particularly where businesses experience shorter periods of sickness absence.

The way SSP is calculated is also changing. Instead of relying solely on a flat weekly rate, SSP will now be calculated as the lower of 80% of the employee’s average weekly earnings or £123.25 per week, which becomes the new flat rate from April 2026. This introduces more variability into SSP payments.

For higher earners, SSP will often remain at the flat weekly rate. For lower earners, payments may fall below the flat rate because they are capped at 80% of average weekly earnings. This means SSP will no longer be a single standard payment for everyone.

Calculating SSP under the new rules follows a clear sequence. Average Weekly Earnings are calculated first, typically using the employee’s relevant earnings period before sickness begins, usually the previous eight weeks, in line with existing rules. This includes basic pay, paid overtime, commission, and bonuses. Eighty percent of that figure is then calculated and compared to £123.25. The lower amount is the SSP payable.

Zero-hour and irregular hours workers are likely to represent one of the most significant areas of impact. Where a worker meets the definition of an employee, they can qualify for SSP. From April 2026 there is no minimum earnings threshold and SSP is payable from day one.

For workers with irregular hours or pay, average weekly earnings are calculated across the relevant reference period, usually the previous eight paid weeks in which they earned pay. Eighty percent of that average is then calculated and compared to £123.25.

For example, if a zero-hour worker earned £300, £250, £200, £350, £300, £280, £320, and £300 across the last eight weeks, total earnings would be £2,300. Average weekly earnings would be £287.50. Eighty percent of that is £230. As this exceeds £123.25, SSP would be capped at £123.25 per week.

If average weekly earnings were £120, then 80% would be £96, and SSP would be £96 per week rather than £123.25.

One area that is often overlooked is how SSP is allocated across working days. Although SSP is calculated as a weekly entitlement, it is still paid daily depending on qualifying days. For employees working a standard five-day week, this is usually straightforward. For part-time, zero-hour, or irregular workers, however, the number of agreed working days per week can have a significant financial impact.

Where a clear working pattern is agreed, for example three days per week, the weekly SSP entitlement is divided across those qualifying days. Where no agreement exists and the working pattern is completely irregular, the default position is to divide the weekly SSP across seven days. In some cases, this can result in a higher daily rate and more SSP being paid than anticipated. A documented working pattern reduces uncertainty and supports consistent payroll processing.

There are also transitional rules for employees who are already off sick around 6 April 2026. Depending on individual circumstances, employees previously below the earnings threshold may become newly eligible. Employees already receiving SSP may remain on the previous flat-rate calculation for the remainder of that sickness absence. Linked periods of sickness will need careful review, as these rules are technical and situation-specific.

In practical terms, employers should expect increased SSP costs, more employees qualifying, greater variability in SSP payments, increased payroll complexity, and a greater need for accurate sickness reporting. Businesses with part-time staff, casual workers, zero-hour contracts, or lower-paid employees are likely to see the most noticeable financial impact.

Preparation will involve ensuring payroll systems reflect the new legislation, applying transitional rules correctly, and calculating SSP accurately based on earnings data. Whether payroll is managed in-house or by a provider, timely and accurate sickness information will be essential for correct processing.

These changes are based on UK legislation and official government guidance, including the Employment Rights Act 2025, amended Statutory Sick Pay Regulations from 6 April 2026, Department for Work and Pensions employer factsheets, and HMRC statutory payments guidance. GOV.UK remains the primary source for the most up-to-date statutory rates and technical detail.