What are the 2026/27 statutory sick pay changes for UK employers?

From 6 April 2026 , up to 1.3 million low-paid workers become newly eligible for Statutory Sick Pay (SSP) as the government abolishes the three unpaid waiting days and removes the Lower Earnings Limit (GOV.UK, Employment Rights Act 2025 SSP factsheet). SSP is now paid from the very first day of sickness, calculated at the lower of 80% of average weekly earnings or the new flat rate of £123.25 a week. Updating your payroll and new tax year processes now means your team stays compliant without last-minute scrambling.

What are the statutory sick pay changes from April 2026?

From 6 April 2026 , the statutory sick pay changes mean SSP pays from day one, has no minimum earnings threshold, and uses an earnings-linked calculation model. Employers must update internal policies for the start of the new tax year .

💡 Good to know: These changes affect both new and existing employees immediately from 6 April 2026.

When does statutory sick pay start under the 2026 day one rule?

SSP is now payable from the very first qualifying day of a Period of Incapacity for Work (PIW) . With the abolition of the waiting days, employers must process payments from day one, tracking staff absences carefully through effective absence management .

The three unpaid waiting days no longer exist for any sickness absences starting on or after 6 April 2026. Payroll must identify the first sickness day, confirm that the continuous 4-day PIW tracking threshold is satisfied to validate the claim, and process the day-one payment without deducting waiting days.

How does the removal of the lower earnings limit affect eligibility?

All employees, regardless of whether they earn below the old threshold, now qualify for statutory sick pay. The removal of the Lower Earnings Limit creates an HMRC requirement to assess all staff for SSP entitlement.

The historic threshold mechanism no longer applies. Employers must manage an increased SSP volume, particularly for casual workers and flexible-schedule personnel who now automatically qualify for statutory coverage.

How much is statutory sick pay for the 2026/27 tax year?

The standard SSP rate has increased to £123.25 per week for the 2026/27 tax year. Employers must ensure that payroll runs correctly apply this updated statutory figure to eligible staff, adhering to the unchanged duration limit of 28 weeks for any single or linked period of sickness. Finance teams must diligently record the exact paid rate within internal statutory sick pay compliance documents for state verification.

What is the maximum duration limit for the standard SSP rate?

The maximum duration limit for the standard SSP rate is strictly capped at 28 weeks . Under HMRC guidelines, processing the standard rate against this ceiling requires executing specific compliance checks to track the continuity of a claim over time:

• Cross-reference current illness entries with historical payroll data; if two sickness windows are separated by 56 days or less, they link to form a single continuous claim chain against the 28-week cap.

• Monitor ongoing, long-term sick leave cases continuously to identify the exact pay period when the allocation is fully exhausted.

How does the 80% earnings cap apply to lower-paid workers?

Employees whose calculated Average Weekly Earnings (AWE) fall below £123.25 weekly receive exactly 80% of that calculated baseline. This triggers automatically when calculated AWE falls below the standard statutory maximum, requiring dynamic calculations for those on a zero-hours contract :

How should employers calculate statutory sick pay under the new rules?

Calculations require determining Average Weekly Earnings (AWE) and dividing the applicable weekly SSP rate by the employee's Qualifying Days . Finance teams must follow a strict mathematical sequence to process accurate payments before generating compliance documentation like a payslip .

📌 Example: For an employee qualifying for the standard statutory rate and working a 5-day week, their daily rate is exactly £24.65 (the weekly maximum of £123.25 divided by 5).

How do you calculate average weekly earnings (AWE) for the 80% rule?

Average Weekly Earnings (AWE) is calculated over the standard 8-week reference period preceding the absence. Payroll teams must:

• Identify all gross pay processed during the relevant 8-week window prior to the absence.

• Divide total gross pay by the exact number of weeks in that period to establish baseline AWE .

• For low earners, multiply the baseline AWE by 80% and round up to the nearest whole penny.

• For new starters, calculate the baseline using their scheduled contractual pay.

How do you work out the daily SSP rate based on qualifying days?

The applicable weekly SSP amount must be divided by the employee's normal weekly working days. A Qualifying Day is legally defined as a scheduled working day, and SSP is strictly paid for these specific days only.

Establish the weekly entitlement, divide by the standard number of Qualifying Days , and apply the resulting daily rate, ensuring any partial penny is rounded up, to the exact number of sick days.

What are the transitional rules for sickness absences crossing April 2026?

Special transitional protection ensures employees aren't financially disadvantaged when an absence crosses 6 April 2026. Employers must manage these overlapping dates to avoid underpaying cases that began in the previous tax year while updating their leaves and absences records.

👉 To note: Transitional rate protection is permanently lost upon return to work, even if a future absence links back within 56 days .

How is statutory sick pay calculated for absences spanning 6 April 2026?

Absences spanning 6 April automatically transition to the day-one rule for sick days from 6 April onwards:

• Standard Earners: Automatically transition to the uprated statutory rate of £123.25 per week.

• Transitional protection for mid-range earners: If an employee earning between £125 and £154.05 a week was already receiving SSP before 6 April 2026 and remains off sick on that date, they keep the flat rate of £123.25 rather than dropping to 80% of AWE. This protection applies only to that specific absence and ends as soon as the employee returns to work or their entitlement runs out; any new absence afterwards, even if linked, is paid at 80% of AWE (GOV.UK, 18 March 2026).

• Historical LEL exceptions: Employees previously excluded from SSP for earning below the Lower Earnings Limit can claim it from 6 April 2026 at 80% of their AWE, provided their sickness absence started on or after 22 September 2025 , or started earlier but included a return to work between 22 September 2025 and 5 April 2026. Anyone who was continuously off sick from on or before 21 September 2025 through to 5 April 2026 remains ineligible until they've returned to work for at least 8 weeks (GOV.UK, 18 March 2026).

How do linked periods of incapacity for work function under the new rules?

The 56-day linking rule remains intact, but linked absences crossing the legislative change require careful Average Weekly Earnings (AWE) calculation. If two sickness periods are separated by 56 days or less, they continue to link together against the maximum 28-week duration limit.

Identify if a new absence falls within 56 days of an older, pre-April absence, and use the AWE calculated for the very first period of sickness to strictly dictate the rate calculation for the entire linked chain.

How do the 2026 statutory sick pay changes impact employer payroll processes?

Employers should review their software and update HR policies to handle day-one SSP and earnings-linked calculations. The Employment Rights Act 2025 changes how SSP eligibility is assessed, so payroll teams will need to configure payroll systems to remove historical earnings blocks and keep clear records of day-one absences.

What immediate updates are required for payroll and HR software?

Payroll systems need to stop deducting waiting days and automatically apply the percentage-linked calculation for low earners. Aligning these settings within your payroll in human resource management processes helps you avoid compliance errors from the outset:

• Maintain the 4-day continuous block logic required to trigger a valid Period of Incapacity for Work (PIW) , while removing the 3 unpaid waiting days from final payment calculations.

• Automate configurations to compare the calculated AWE against the flat statutory cap, selecting the lower result.

• Ensure RTI data transmissions accurately reflect these variable adjustments within each Full Payment Submission (FPS) .

What are the new enforcement powers of the Fair Work Agency regarding statutory sick pay?

The Fair Work Agency ( FWA ) was formally established on 7 April 2026 , the day after the SSP reforms took effect. According to ACAS , it holds enforcement powers over SSP compliance, meaning it can investigate underpayment and take formal action against non-compliant employers, including issuing Notices of Underpayment where payroll audits reveal a failure to pay correct SSP from day one. This adds a new layer of payroll compliance oversight for employers.

💡 Good to know: We recommend confirming the exact financial penalty scale directly on GOV.UK before quoting a specific percentage, as current guidance details penalties for non-payment of tribunal awards rather than a confirmed SSP-specific tariff.

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