Day-One Sick Pay: What Employers Need to Know

The ERA 2025 removed the three-day waiting period for SSP and scrapped the earnings threshold. Here is exactly what changed and what you need to do.

Until the Employment Rights Act 2025 came into force, Statutory Sick Pay came with two gatekeeping mechanisms that kept costs down for employers. First: a three-day waiting period, meaning SSP only kicked in from the fourth day of illness. Second: a Lower Earnings Limit — if an employee earned less than £123/week, they weren't entitled to SSP at all. Both are gone.

This is not a small administrative change. For a business with ten employees, the removal of the waiting period alone means that any first-day absence now potentially triggers a financial obligation. The change affects every employer in the UK, from sole traders with one member of staff to firms with thousands.

What the law actually says

Section 12 of the Employment Rights Act 2025 amended the Statutory Sick Pay entitlement under the Social Security Contributions and Benefits Act 1992. The amendments did two things:

• Removed the three waiting days. Previously, SSP only became payable from day four of absence (days one to three were "waiting days" for which no SSP was due). From April 2026, SSP is payable from day one.
• Removed the Lower Earnings Limit. Previously, employees had to earn at least £123/week (the LEL for 2025/26) to qualify. That threshold no longer applies. Any employee who is sick is entitled to SSP, regardless of earnings.

The current SSP rate is £123.25/week, or 80% of average weekly earnings — whichever is lower. The 80% cap is new and protects very low earners from receiving SSP that exceeds their actual earnings. For most full-time employees, the flat rate of £123.25/week will apply.

SSP is now payable from the first day of absence, to every employee regardless of earnings. If your policy still mentions waiting days or a minimum earnings threshold, it is wrong.

Who is affected

Every employee in the United Kingdom. There is no size exemption for small employers, no minimum tenure requirement, no earnings floor. A part-time worker earning £80/week who has been employed for two weeks is now entitled to SSP from day one of illness — they would receive 80% of their weekly earnings (£64) rather than the flat rate, since £64 is lower than £123.25.

The distinction between employees and workers matters here. SSP applies to employees, not to self-employed workers or genuinely independent contractors. But if someone is classified as a worker rather than an employee, take care: many gig-style arrangements that were previously treated as self-employment have been successfully challenged at tribunal. If someone works regular hours, uses your equipment, and follows your instructions, the classification question is worth revisiting.

What has not changed

Several features of the SSP regime are unchanged, and conflating them with the new rules will cause problems.

Self-certification still applies for the first seven days. An employee who is ill for seven days or fewer can self-certify their absence. They do not need a GP fit note for absences of a week or less. This was not altered by the ERA 2025.

Fit notes are required from day eight. For absences extending beyond seven calendar days, the employee must provide a fit note from their GP or another authorised healthcare professional. The seven-day self-certification window is measured in calendar days, not working days.

SSP is payable for a maximum of 28 weeks. This limit is unchanged. After 28 weeks, SSP ends, and employees may be eligible for Employment and Support Allowance.

The qualifying conditions for "incapacity for work" are unchanged. The employee must be genuinely incapable of work due to illness or injury. Employers cannot demand medical evidence for short absences (within the self-certification window), but they can apply a consistent, non-discriminatory attendance management process.

The manager problem

The removal of waiting days changes the economics of first-day absence in a way that most managers haven't processed yet. Previously, a first-day absence cost the employer nothing in SSP — it was just an operational inconvenience. From April 2026, every first-day absence potentially triggers up to £123.25/week.

This creates pressure — and pressure, if not managed carefully, creates risk. A manager who applies stricter scrutiny to first-day absences than to longer ones, or who treats certain employees differently when they call in sick on a Monday, is creating tribunal liability. The correct response is a consistent attendance management policy, applied without exception.

Managers need to understand three things:

1. They cannot demand a GP note for a first-day absence. Self-certification applies for up to seven days. Requiring medical evidence before that point is only permissible under a specific contractual provision, and even then, it must be applied consistently.
2. Return-to-work interviews are now more important. A brief return-to-work interview — not an interrogation, but a structured conversation — is the legitimate way to manage absence patterns. Document them consistently.
3. The Bradford Factor calculation, if you use one, needs updating. Any absence scoring system that treated waiting days differently from paid sick days may now produce incorrect outputs. Review it.

Company sick pay and the new rules

Many employers pay more than the statutory minimum — full pay for a period, then half pay, then SSP. The ERA 2025 does not cap or restrict company sick pay schemes. But it does set a new floor.

If your company sick pay scheme paid full pay from day one but only paid SSP from the fourth day when the full pay period expired, you now need to check the transition point. An employee whose contractual sick pay runs out mid-week must receive at least the SSP rate (or 80% of AWE if lower) from day one of their absence — even if their contractual entitlement has been exhausted.

Put more simply: company sick pay can be more generous than SSP, but it can no longer be structured in a way that effectively reintroduces the waiting days. A policy that pays nothing for the first three days and then pays enhanced sick pay from day four would breach the statutory floor.

Review your sick pay scheme against this test: at no point during the first 28 weeks of absence should an employee receive less than the applicable SSP rate (or 80% AWE, whichever is lower). If your scheme fails that test, it needs updating before an employee claims.

What your policy document must say

Your written sick pay policy — whether it's a standalone document or a section of your employee handbook — must now accurately reflect the current law. A policy that still refers to "three waiting days" is not just out of date; it misrepresents employees' rights and could be used as evidence of non-compliance.

The policy should specify:

• That SSP is payable from day one of absence
• The current SSP rate (£123.25/week, or 80% of AWE if lower)
• The notification procedure — when to call in sick, who to notify, what information is required
• The self-certification window (first seven calendar days)
• When a fit note is required (from day eight)
• Any company sick pay entitlement above the statutory minimum, including how it interacts with SSP
• The return-to-work interview process

If your employment contracts contain sick pay terms — and many do — check those too. A contract clause that refers to waiting days creates a conflict with the statutory entitlement. The statute wins, but the conflict is untidy and needs removing.

Practical checklist

The Fair Work Agency's enforcement scope will eventually cover SSP compliance. For now, the more immediate risk is employment tribunal claims from employees who were denied SSP they were entitled to, or who were treated adversely because of first-day absences. Both risks are manageable — the requirement is to have the right policy and apply it consistently.

Sources

• Employment Rights Act 2025, s.12 — SSP amendments (legislation.gov.uk)
• GOV.UK — Statutory Sick Pay: employer guide
• GOV.UK — ERA 2025 implementation timeline
• Social Security Contributions and Benefits Act 1992, Part XI — Statutory Sick Pay (legislation.gov.uk)