Understand Statutory Sick Pay

Contractual issues

You must detail your rules on sick pay in the written statement of employment particulars. This must be given to all employees who work for you for one month or more.

Precedent in overpayment of Statutory Sick Pay (SSP)
If you make payments in excess of the statutory amounts of sick pay over a period of time, you could set a binding precedent.

If an employer attempts to revert back to the SSP limit having noticed their (possibly inadvertent) mistake of paying at a higher rate, the employee could claim:

• unlawful deduction of wages
• breach of contract
• constructive dismissal after resigning

In addition, employers are only able to recover - or offset against other liabilities - the SSP amount.

Long-term sickness dismissal rights
An employee's inability to do their job because of long-term sick leave can be a valid reason for dismissal. However, in the event of an unfair dismissal complaint, and employment tribunal will expect you to have:

• consulted the employee and found out as much as possible about their condition and the likely timescale for their recovery
• considered all the alternatives to dismissal, such as changing the employee's role or hours of work
• followed the statutory "standard dismissal and disciplinary procedure"

Unfair dismissal law requires the tribunals to take account of a business' size when deciding whether a dismissal was reasonable on ill-health grounds or any other. However, procedurally it is essential to follow the statutory dismissal procedure otherwise you risk a finding of automatically unfair dismissal. See our guides on when an employee leaves through ill health, on managing absence and sickness and on dismissal.

It is important to consider the implications when considering dismissal on the grounds of long-term sickness. See our guide on how to prevent discrimination and value diversity.

Subjects covered in this guide

• Introduction
• What is Statutory Sick Pay and who gets it?
• Earnings-related qualification for SSP
• When to start and stop payments
• How much to pay
• Record keeping and forms
• Getting subsidies or relief
• Alternatives to paying Statutory Sick Pay
• Contractual issues