Can an employer reclaim Statutory Sick Pay (SSP) from HMRC?

No. The main scheme for reclaiming SSP (according to the ‘Percentage Threshold Scheme’, PTS) was abolished in April 2014, in order to simplify the process for employers. This means that for all regular absences, the employer is responsible for 100% of the SSP cost. A separate, temporary reclaim scheme was introduced during the COVID-19 pandemic, but that scheme has now been wrapped up. The full financial cost of SSP must therefore be covered by the employer as part of their payroll.

What are qualifying days for SSP?

Qualifying days (QDs) are the days a staff member normally works under their contract. These are the only days for which SSP is paid, and they are also used to count the 3 waiting days (WDs). For a standard Monday-Friday employment, QDs are those five days. If a staff member works part-time, for example, only on Tuesdays and Wednesdays, those are their 2 QDs. For those with variable hours or shift patterns, you should agree on their QDs in advance, as this is crucial for calculating SSP correctly.

Does an employee on a zero-hours contract get SSP?

Yes, workers on zero-hours contracts can be eligible for SSP. They are protected by employment law and entitled to SSP just like any other ‘employee’, provided they meet all the standard criteria to be classed as such. The most important check for zero-hours staff is the earnings requirement. They must earn, on average, at least the Lower Earnings Limit (£125 in 2025/26). This average is usually calculated over the 8-week period leading up to their absence, giving you the information needed to confirm their eligibility.

Where can I find more information on managing payroll?

Managing SSP is just one part of running a compliant and efficient payroll. As your business grows, you’ll also need to manage pensions, National Insurance categories, student loan deductions, and other statutory payments like maternity and paternity pay. For more in-depth guides, checklists, and articles on UK payroll legislation, tax compliance, and HR automation, check out the Payfit resources page for UK employers.

What is Statutory Sick Pay (SSP)? A UK employer’s guide

Key takeaways

Here are the key points UK employers must know about statutory sick pay:

What is SSP? The legal minimum payment you must pay employees who are off sick.
Who is eligible for SSP? Staff sick for 4+ consecutive days who earn above the Lower Earnings Limit (LEL).
How much is SSP? £118.75 per week (2025/26), for a maximum of 28 weeks.
What are ‘waiting days’? The first three normal working days of absence that are not paid.
What is expected in terms of future reforms: Major changes are expected, which may remove waiting days and the LEL, making more employees eligible.

For growing UK businesses, managing Statutory Sick Pay (SSP) is a legal and financial challenge, and a key requirement that connects payroll and HR to staff welfare.

Getting SSP wrong risks non-compliance and labour tribunals. For HR and finance managers, understanding the rules is therefore essential.

This guide covers the rules of SSP, who is eligible, how to process it, and future reforms. And we’ll outline all the criteria to help you manage staff absences compliantly.

What are the fundamental rules of statutory sick pay?

Statutory sick pay is the legal minimum employers must pay a staff member who cannot work due to illness. It is a legal obligation set by the government and updated annually. Your duty, as an employer, is to check eligibility, process the pay via payroll, and make correct tax and NI deductions.

Who is eligible for SSP?

Employees are entitled to SSP if they:

Are classed as an ‘employee’ (including those on fixed-term or zero-hours contracts);
Have started their employment;
Are sick for 4 or more consecutive days (a ‘Period of Incapacity for Work’, or PIW), including non-working days;
Earn an average of at least the Lower Earnings Limit (LEL) - £125 per week for 2025/26;
Notify you of their absence per your policy (or within 7 days); and
Are able to provide proof of illness (such as a fit note after 7 days).

Who is not eligible for SSP?

Employees are not eligible if they:

Earn less than the Lower Earnings Limit;
Have exhausted their 28-week SSP allowance;
Are receiving Statutory Maternity Pay or Maternity Allowance; or
Are in legal custody (for example, detained by the police).

If ineligible, you must give them an SSP1 form, which they will need to claim other financial benefits like Universal Credit.

How much is statutory sick pay, and for how long is it paid?

Managing SSP requires precise calculations of the rate, waiting period, and duration.

What is the current SSP rate?

The SSP rate for 2025/26 is £118.75 per week. This flat rate is paid for ‘qualifying days’ (i.e. normal working days). You then pay a daily rate for each day they are off after the waiting period.

What are waiting days?

SSP is not paid for the first 3 qualifying days of an absence, called ‘waiting days’ (WDs). Payment then begins on the fourth day. This rule applies to each new absence, unless it’s ‘linked’ to a previous one.

What are linking periods?

Sickness periods are ‘linked’ if each lasts 4 or more days and they are 8 weeks (56 days) or less apart. Linked periods are treated as one. This means:

The 3 waiting days are not needed again.
All days count towards the 28-week limit.

Tracking linked periods is a major admin burden, making payroll software essential.

For how long can an employee claim SSP?

An employee can claim SSP for up to 28 weeks in a single or ‘linked’ period of absence, including what is classed as ‘long-term sick leave’. When this allowance ends, your obligation to pay stops. You must issue an SSP1 form by the 23rd week so that the worker has time to arrange other support.

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What are an employer’s responsibilities for managing SSP?

Your duties extend beyond payment to include proof of illness, payroll processing, and record-keeping.

What proof of sickness is required?

You need to make sure you have a clear absence reporting policy, including the following variable requirements:

First 7 days: Self-certification, e.g. by phone, email, or using an internal form.
After 7 days: A fit note is required, under UK sick pay entitlement rules. This note states whether the worker is ‘not fit for work’, or ‘may be fit for work’ with certain adjustments made.

You cannot demand a fit note before the eighth day of illness.

How do you process SSP payments through payroll?

SSP is paid on the normal payday, and is subject to PAYE and National Insurance. A modern payroll software automates all of these SSP calculations and deductions.

What records do employers need to keep?

You must keep detailed SSP and absence records for at least 3 years after the relevant tax year. As the Gov.UK guidance on employers’ responsibilities states, these must include:

Dates of the leave.
All fit notes and self-certification forms.
Copies of any SSP1 forms issued.
Records of all SSP payments.

HMRC can request these records at any time.

What is the difference between SSP and contractual sick pay?

SSP is the legal minimum you must pay. Contractual Sick Pay, also called Occupational Sick Pay (OSP), is an optional, more generous benefit in an employment contract (e.g. 4 weeks full pay).

Your contractual scheme must be at least as generous as SSP. The contractual payment usually includes the SSP amount (e.g. SSP plus a ‘top-up’ to equal full pay).

What happens when statutory sick pay ends?

When SSP ends (at 28 weeks, or if eligibility ceases), your responsibility shifts to providing information for state support.

What is an SSP1 form?

You must give an SSP1 form to your staff member within 7 days of SSP ending unexpectedly, or by the 23rd week if the limit is approaching. They will need this form in order to claim state benefits.

What other financial support is available?

When SSP ends, employees still unable to work may claim government support, such as Universal Credit (UC) or the ‘new style’ Employment and Support Allowance (ESA). You can find details on the official gov.uk page for ESA. Your key role is to provide the SSP1 form promptly.

What future reforms are planned for SSP?

The UK government is planning major reforms to statutory sick pay, expected to take effect in April 2026. The changes are part of the new Employment Rights Bill, and will significantly widen the SSP safety net.

The key proposals employers must prepare for are:

Removal of the Lower Earnings Limit (LEL): This will make all employees eligible for SSP, regardless of how much they earn.
Abolition of waiting days: The 3-day waiting period will be removed, meaning SSP will be payable from the first day of absence.
New rate for low earners: Those earning below the LEL will receive a new statutory rate, likely 80% of their earnings (up to the flat SSP rate).

These reforms will, of course, significantly impact payroll processing and company costs.

How can payroll software help manage SSP compliance?

The SSP admin burden is significant. Manually tracking absences, linked periods, and calculations is risky. Automated tools and compliance checklists are therefore essential in order to ensure:

Accuracy: A payroll system automates eligibility and pay calculations, including linked periods.
Compliance: The software stays updated with statutory rates and tax rules.
Record-keeping: It creates an automatic, auditable trail.
Efficiency: It frees up HR and finance department time.

Payfit’s payroll software handles SSP complexities seamlessly. Understanding the intricacies of SSP and leave and absence management is the only first step, implementing a robust system is the next.

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If an employee becomes sick while on paid holiday, they can choose to be treated as sick instead of on annual leave. They must, however, follow your company’s standard absence management and sickness reporting procedures. This includes notifying their manager of their illness as soon as possible (e.g. on the first day), and providing a fit note if the sickness lasts more than 7 days, even if they are abroad. If they follow the procedure and qualify for sick pay (either SSP or contractual), you should pay them this instead of holiday pay for those days. The holiday days they were sick are then considered ‘untaken’ and are added back to their annual leave allowance, which they can re-book for a later time. Managing holiday pay and leave complexities such as these demands a comprehensive HR and payroll software platform, which is exactly what Payfit offers.

What is Statutory Sick Pay (SSP) for UK employers?