Source · Select Committees · Work and Pensions Committee

Recommendation 1

1 Accepted Paragraph: 50

Statutory Sick Pay provides inadequate financial protection during periods of sickness absence.

Conclusion
Statutory Sick Pay does not currently provide adequate protection for those who most need protecting from financial hardship during periods of sickness absence. It consequently fails to perform its primary function of providing a basic level of income protection.
Government Response Summary
The government agrees that the current SSP system fosters economic insecurity and is taking specific actions to provide wider access, including extending eligibility to those earning below the Lower Earnings Limit (who will receive 80% of normal earnings) and removing the waiting period for payment from the first day of sickness absence.
Paragraph Reference: 50
Government Response Accepted
HM Government Accepted
SSP has always been designed to balance support for an individual when they are unable to work due to sickness or ill health, with the costs to employers of providing this support. It provides the minimum level of income that employers must pay to eligible employees; but we know that most employees are eligible for more than the statutory minimum through contractual or occupational sick pay arrangements with their employer.2 The Government agrees that the current SSP system fosters economic insecurity at work. We are providing wider and better access to Statutory Sick Pay through our New Deal for Working People. Our commitment to extend eligibility to those earning below the Lower Earnings Limit and for 1 Impact assessment: Improve access Statutory Sick Pay removing Lower Earnings Limit and waiting period 2 Employee research Phase 2: Sickness absence and return to work. Quantitative research. this group to receive 80% of their normal weekly earnings will mean the safety net of SSP is available for up to 1.3 million additional employees, particularly benefiting women, young people, and those in part-time work. By removing the waiting period so that SSP is paid from the first day of sickness absence, we are benefitting around 25% of employees who rely on Statutory Sick Pay only, who will now receive SSP on the first day that they need it. It is important to note that SSP is not the only safeguard in providing a basic level of income protection. Government support through the welfare system, including Universal Credit, is also available for those on low incomes who need extra financial help when they are sick and incapable of work, depending on individual circumstances.