Statutory sick pay (SSP)
By law, you must pay statutory sick pay (SSP) to all employees who are off work due to sickness and qualify for sick pay. Sage One Payroll contains the most up to date legislation and simplifies processing sick pay by automatically calculating SSP for you.
We’ve gathered together everything you need to help you understand the qualifying rules and entitlement, as well as how to record it in Sage One.
You can also find information from GOV.UK.
Your employee must be employed by you and have done some work for you under their contract of employment before they’re off sick. All days of sickness, even non-working days, count towards the total number of days in a period of incapacity for work (PIW).
If your employee is off sick for fewer than four consecutive days, there’s no PIW and you don’t need to take any action.
Your employee’s average weekly earnings (AWE) in the relevant period must be at or above the current national insurance lower earnings limit (LEL). For the 2015/2016 tax year, this is £112.00.
The relevant period is approximately eight weeks prior to the start of the PIW and is used to calculate the employee’s average earnings. Sage One Payroll automatically calculates this for you, but you can find more information about the relevant period from GOV.UK
The first three days of the PIW are known as waiting days. You don’t pay SSP for these days.
If your employee is off sick for fewer than seven days, you can accept self-certification from them. This can be verbal, by letter or HMRC form SC2. It’s down to your company policy how an employee must inform you of sickness. You can only ask for a Statement of Fitness for Work, or fit note, if the employee is off sick for more than seven days.
- The amount of SSP the employee is entitled to depends on a number of factors, such as their AWE prior to the absence.
- Normally, the AWE is calculated from the employee’s pay over the eight weeks immediately prior to the first day of absence.
- Employees who qualify for SSP are entitled to £88.45 per week for up to 28 weeks per period of sickness.
- An employee receiving statutory maternity pay (SMP) or maternity allowance (MA) is not entitled to receive SSP during the 39 week period which SMP or MA is payable.
A period of sickness that starts within 56 days of another period ending is considered to be linked and in effect continues as one period of sickness. This is included in one 28 week entitlement. A period of sickness that starts more than 56 days after a previous one isn’t linked, and the employee is entitled to another 28 weeks SSP.
- You must only pay SSP to an employee for a linked period of sickness for a maximum of three years.
- Any periods of SSP with a previous employer don’t count towards an employee’s maximum period of SSP.
- Only full days are recorded for the purposes of SSP. If an employee is off work because of sickness for a half day, this is not recorded for SSP purposes.
To ensure the correct entitlement calculates, you should check the employee’s working pattern is correct. The working pattern determines where waiting days and qualifying days fall.
- 1. Pay > Process Pay Run.
- 2. Check the pay date is correct > Next.
- 3. Select the employee > Add Absence.
- 4. Choose Sickness > complete the following details:
|Documentation Received||If the employee has provided you with evidence of their incapacity to work, choose Yes.
For extended sickness of up to seven working days, verbal evidence, a letter or an SC2 form is usually acceptable. For longer sicknesses, a doctor’s statement is usually required.
|Pregnancy-related Illness||If the sickness relates to the employee’s pregnancy, select this check box.|
|Start Date||Enter the start date of the period of sickness that qualifies for SSP.|
|End Date||Enter the end date of the period of sickness that qualifies for SSP.|
|Pension Earnings||If any payment made to the employee as SSP should be included in pensionable earnings, select this check box.|
|Qualifying Earnings||If any payment made to the employee as SSP should be included in qualifying earnings, select this check box.|
- 5. Click Save.
If there’s not enough information to calculate the average weekly earnings (AWE), this option appears:
|Issue certificate SSP1||If the employee isn’t entitled to SSP because their earnings are less than £112, click the SSP1 link and provide them with the form.|
|Manually set the AWE value||If you started using Sage One Payroll part-way through the tax year and there’s not enough history to calculate the average pay, select Manually set the AWE value > enter the average weekly pay.|
- 6. Click Save.
- 7. Complete the pay run as normal.
Employers can’t recover SSP paid in respect of periods after 5 April 2014. You can find further information from GOV.UK.