6th April 2026 will see changes to Statutory Sick Pay brought about by the new Employment Rights Act 2025. This change will see all employees, for the first time ever, entitled to SSP, regardless of their level of earnings, as the lower earnings limit (LEL) is removed. SSP will be calculated as 80% of an employee’s average weekly earnings (AWE) or the current flat rate (confirmed as £123.25 from 6th April), whichever is lower. In addition, waiting days will be eliminated, enabling eligible employees to receive SSP from the first full day of sickness absence.
At the end of 2025, the Government confirmed some transitional details:
- Employees earning below the LEL who are off sick on or after 6th April will be eligible for SSP from 6th
- Those serving waiting days on 6th April will receive SSP from that date onwards.
- Employees earning between £125.00 and £154.05 per week and already receiving SSP before 6th April will be transitionally protected to prevent a reduction in their SSP rate. This means they will receive the flat rate of £123.25 until they return to work, exhaust their entitlement or their contract ends.
The Government also confirmed how the calculation of average weekly earnings and SSP was also confirmed:
- SSP for those earning below the flat rate will be based on 80% of their AWE, calculated over a relevant eight-week period
- payments will be rounded up to the nearest whole penny
- for linked periods of incapacity (within 56 days), the initial period’s AWE will be used for subsequent calculations.
We encourage clients to ensure employment contracts are up to date and align with the new rules, including sick pay policies. Also ensure that your payroll software is up to date. If you are a Castletons payroll client, you can rest assured that our software, systems and processes are up to date.
