Preparing for Statutory Sick Pay changes from April 2026

Significant changes to Statutory Sick Pay are coming and every employer will be affected.

From April 2026, reforms introduced under the Employment Rights Act will reshape how SSP works, expanding eligibility and changing how payments are calculated.

These updates will place new demands on payroll processes, budgets and internal policies, making early preparation essential.

What is changing?

One of the most notable reforms is the removal of waiting days. Under the new rules, SSP will be payable from the first day of sickness absence, rather than starting on day four as it does now.

This means employers will be required to pay SSP for short-term absences that previously may not have qualified.

Another major shift is the abolition of the Lower Earnings Limit. As a result, SSP eligibility will extend to part-time, low-paid and casual workers who were previously excluded.

How SSP payments will be worked out

The way SSP is calculated will also change. Instead of a single flat rate, SSP will be paid at whichever is lower of the following:

• 80 per cent of an employee’s Average Weekly Earnings
• The standard flat SSP rate, increasing to £123.25 per week

SSP will continue to be based on average weekly earnings, typically calculated using the eight weeks leading up to the sickness absence.

Employees already receiving SSP before six April 2026 will be covered by transitional protection.

This will apply for the remainder of their 28-week entitlement, provided they do not return to work or their employment does not end during that period.

Steps employers should take now

These reforms will increase payroll complexity and cost exposure, particularly as more employees become eligible for SSP. Employers should begin planning well in advance.

Key actions include:

• Reviewing sickness absence policies to reflect day-one SSP entitlement
• Updating employment contracts and staff handbooks that reference waiting days or earnings thresholds
• Ensuring payroll software can manage percentage-based SSP calculations
• Forecasting the financial impact of wider SSP eligibility
• Communicating changes clearly so employees understand their entitlements

Addressing these areas early can help avoid disruption and reduce the risk of payroll errors.

How Brown Butler can help

Brown Butler’s payroll specialists can support employers in preparing for the upcoming SSP changes.

This includes modelling the financial impact, reviewing payroll systems and ensuring calculations are fully compliant with the new rules.

Support is also available to review policies and documentation, helping to minimise risk and maintain confidence as the changes take effect.

For advice or guidance on how the SSP reforms may affect your business, contact the Brown Butler team today.