From 6 April 2026, Statutory Sick Pay changed significantly for UK employers. The old 3 waiting days have been removed, meaning SSP is now payable from the first full day of sickness absence. The Lower Earnings Limit has also been removed, so eligible employees can qualify for SSP regardless of their earnings level.
For small employers, these changes affect payroll, absence management and cash flow. More employees are now within the SSP system, and short-term sickness absences that previously created no SSP cost may now create an immediate payment obligation.
What Has Changed With SSP in 2026?
The 2026 changes were introduced under the Employment Rights Act 2025 and apply across the UK.
Before 6 April 2026, SSP was usually payable only from the 4th qualifying day of sickness. Employees also needed to earn at least the Lower Earnings Limit to qualify. For 2025/26, that threshold was £125 per week.
From 6 April 2026, SSP is payable from the first full day of sickness absence. The Lower Earnings Limit no longer prevents lower-paid employees from qualifying. The weekly SSP rate for 2026/27 is £123.25, but the actual amount due is now the lower of the flat weekly SSP rate or 80% of the employee’s average weekly earnings.
This means the calculation is no longer as simple as applying the same flat weekly amount to everyone. Employees with average weekly earnings below £123.25 receive 80% of their average weekly earnings instead.
Need Help With Your Accounts Or Tax?
Whether you need support with self assessment, VAT returns, payroll, bookkeeping, CIS, company accounts or corporation tax, Asmat & Co Accountants can provide clear, practical advice for your business or personal finances.
Our post on the autumn budget summary covers the wider legislative programme behind recent employment changes, and our post on national insurance contributions gives context on the broader employer cost picture these SSP changes sit alongside.
Which Employees Now Qualify?
The removal of the Lower Earnings Limit brings many lower-paid, part-time and variable-hours employees into SSP entitlement for the first time.
The key point is that eligibility is no longer blocked simply because someone earns below a weekly earnings threshold. However, the person must still meet the wider SSP rules, including being an employee, being sick for a qualifying day, and following the employer’s sickness reporting process.
This is particularly relevant for businesses with part-time staff, casual shift patterns or employees working a small number of hours each week. A one-day absence that falls on a qualifying working day may now trigger SSP, provided the other rules are met.
For employees whose average weekly earnings are below the flat SSP rate, payroll must calculate 80% of average weekly earnings. For employees whose average weekly earnings are above the flat rate, the statutory weekly cap applies.
Our post on minimum living wage rates and low-paid workers is relevant here, because the employees most affected by the proportional SSP rate are often those working part-time or lower-paid roles. Our post on understanding the calculation of holiday pay also gives useful context on why accurate average earnings calculations matter in payroll.
What the Cost Impact Looks Like for a Small Business
SSP is an employer cost. There is no general scheme allowing employers to reclaim ordinary SSP from HMRC. The old Percentage Threshold Scheme was abolished in 2014 and has not been reinstated.
The biggest change for many small businesses is the cost of short absences. Under the old rules, a short sickness absence of 1, 2 or 3 qualifying days usually created no SSP payment because of waiting days. From 6 April 2026, those absences can create a payment from day one.
For example, if an employee works 5 qualifying days per week and is off sick for 1 qualifying day, SSP is now calculated from that first day. For an employee on the standard weekly SSP rate, that daily amount is £24.65 in 2026/27. The amount may be lower for employees whose 80% average weekly earnings calculation is below the flat rate.
That may not sound large in isolation, but it can add up where a business has regular short-term absence, several part-time staff or seasonal sickness peaks. The financial impact sits alongside other employer costs, including National Insurance, wages, pension contributions and holiday pay.
Our post on cash flow forecasting for small businesses covers how to build employment costs, including SSP exposure, into your planning. Our post on what an accountant does for an SME is also useful for business owners who want professional support managing the combined cost changes affecting employers.
What Small Employers Need to Do Now
Small employers should not assume their payroll software has handled the change automatically. Even where software has updated, the underlying employee records, qualifying days and average earnings data still need to be accurate.
The practical steps are:
- Update payroll systems so SSP is paid from the first full day of sickness absence.
- Remove references to the old Lower Earnings Limit from internal payroll checks.
- Identify employees who were previously excluded by earnings level but may now qualify.
- Check how payroll calculates 80% of average weekly earnings for lower-paid employees.
- Confirm qualifying days for employees with non-standard working patterns.
- Keep accurate sickness absence records.
- Update sickness absence policies and staff handbooks.
- Train managers so they understand when SSP may be triggered.
- Communicate the change to employees clearly.
Accurate absence records are especially important because SSP can last for up to 28 weeks. Linked periods of sickness and previous SSP payments can affect ongoing entitlement, so informal or incomplete records can cause errors later.
Our payroll services cover SSP calculations and processing as standard, helping make sure each employee receives the right amount from the correct date. Our bookkeeping service also ensures SSP payments are correctly recorded in your accounts throughout the year.
Updating Policies and Manager Training
The law changed, but many business policies still use old wording. If your sickness policy still says SSP starts on the 4th qualifying day, it should be updated. If your onboarding documents say staff must earn above the Lower Earnings Limit to qualify, that wording is now out of date.
Line managers also need to understand the change. They may be the first person an employee contacts when they are unwell, so they need to know that even a short absence can now have payroll consequences.
This does not mean employers cannot manage absence. You can still require employees to follow a reasonable reporting process, keep records, ask for self-certification, and request fit notes where absence continues beyond the self-certification period. You can also operate a company sick pay scheme that pays more than SSP, provided employees receive at least their statutory entitlement.
How Asmat & Co Accountants Can Help
As small business accountants supporting employers across Slough, Reading and the wider region, Asmat & Co Accountants can help you keep payroll compliant through the 2026 SSP changes.
We can review your payroll setup, check whether your software is applying the new rules correctly, update SSP calculations for lower-paid employees and make sure absence records are feeding into payroll properly.
Our post on choosing the right accountant covers what to look for in a payroll and accounting partner. Our post on the benefits of hiring an online accountant explains the practical difference professional support can make for small employers managing changing obligations.
Frequently Asked Questions
Does SSP from day one apply to one-day sickness?
Yes, where the day is a qualifying day and the employee meets the other SSP rules. The old 3 waiting days have been removed.
What if I have staff on zero-hours contracts?
They may qualify if they are employees and meet the relevant SSP conditions. The removal of the Lower Earnings Limit means low earnings alone no longer block eligibility. The correct calculation will depend on their average weekly earnings and qualifying days.
Is SSP still capped at 28 weeks?
Yes. SSP can be paid for up to 28 weeks, subject to the employee meeting the rules.
Can I pay more than SSP?
Yes. SSP is the legal minimum. You can offer contractual sick pay that is more generous, but you must not pay less than the statutory entitlement.
Act Now to Make Sure Your Payroll Is Correct
SSP from day one is now in effect. If your payroll has not been updated to remove waiting days, extend eligibility to lower-paid employees and calculate the 80% rate correctly, you may already be underpaying SSP.
Contact Asmat and Co today to confirm your SSP processes are correct and your payroll reflects the 2026 rules from the start.
Need Help With Your Accounts Or Tax?
Whether you need support with self assessment, VAT returns, payroll, bookkeeping, CIS, company accounts or corporation tax, Asmat & Co Accountants can provide clear, practical advice for your business or personal finances.
