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Could employers be obliged to pay the full wages of self-isolating staff?

9 Sep 2020 By Jonathan Owen

Campaigners have highlighted the plight of low-paid workers unable to afford quarantining themselves and called on the  government to act. But how likely is statutory sick pay reform?

The government is coming under mounting pressure to reform statutory sick pay (SSP). This is currently set at £95.85 per week, leaving people just £13.69 a day to live on. Health secretary Matt Hancock reignited the debate earlier this year when he admitted he would not be able to survive on the amount paid. 

Radical reforms are now being proposed, which would see a steep rise in the amount employees were entitled to, amid fears that many cannot afford to take time off if ill or self-isolating because of Covid-19. People Management explores this call for change – crucially, how likely it is to be heeded, and whether employers would be expected to foot the bill...

What's being proposed and by who?

Campaigners are calling for low-paid workers who have to self-isolate as a result of Covid-19 to be paid their full wage for the first six weeks, before reverting to an enhanced SSP rate for the following 22 weeks. This is part of a wider call for all workers to have a sickness income linked to the average hours worked and set at the real living wage. The Labour-linked left wing group, Don’t Leave, Organise, set up by Jewish Voice for Labour, Red Labour and the Labour Representation Committee, is behind the proposals. The Bakers, Food and Allied Workers’ Union, Fire Brigades Union and former shadow chancellor John McDonnell are among those backing the calls. The #FullSickPayNow campaign will be launched at a virtual rally taking place on Zoom this evening (9 September).

Why is this being proposed?

The TUC estimates that more than 1.8 million people miss out on sick pay when they are ill – the vast majority of them women – because they earn less than £120 a week. Poorly paid workers face an impossible choice between protecting their health and that of others and paying the bills, because of the low level of SSP, according to Don’t Leave, Organise. “The Covid-19 pandemic has highlighted the public health benefits of symptomatic workers self-isolating to avoid spreading the virus. Those workers who are not entitled to SSP or who cannot survive on £95 per week are more likely to go into work when ill because they cannot afford not to,” the campaigning group warns. There have been cases of people unable to survive on SSP and being forced to work as a result, it adds.

Who would have to pay this?

Employers would be obliged to pick up the tab for the first six weeks of sick pay. After this period, SSP would be paid, although employers would be able to enhance this if they chose to.

What has the government said?

The Department for Work and Pensions (DWP) describes SSP as a “vital safety net”, and points out it is now, following reform at the start of the UK’s outbreak, payable from day one for those with illnesses related to Covid-19. It highlights it has “extended it to those self-isolating and refunded employers with up to 250 staff the cost of up to a fortnight’s SSP for absence related to coronavirus” through its rebate scheme, announced in March and launched in May.

A DWP spokesperson has said: “We have also consulted on further reforms to SSP and will set out our response later this year. People who are self-isolating are able to claim universal credit and advances are available to help people get money quickly. They may also be eligible to claim employment and support allowance.”

However, the government’s consultation, which closed last year, did admit that “by international standards, the SSP rate in the UK is low”. It said: “While the UK offers a flat rate, in most other countries sick pay is related to earnings. Typically, sick pay is provided at the full wage rate or a high percentage of the wage rate but for a much shorter duration – generally less than 10 weeks – followed by sickness benefits funded by statutory insurance or general taxation.”

However, it added: “The current rate of SSP achieves a balance between ensuring employees receive a regular income from their employer when they are sick and unable to work, while ensuring that the incentive to work remains.” And the consultation stated that the government did “not intend to change the rate or length of SSP at this time”.

How likely is the government to implement what campaigners are calling for?

As such, there is no current indication of the government changing its mind, Kate Palmer, associate director of advisory at Peninsula, tells People Management. But now more than ever, employers must be prepared for an abrupt potential U-turn on this, she says. 

“Despite these calls, there is currently no indication that the government will take steps to enact this,” she says. “However, these are unprecedented times, which have seen the government take significant steps one may not have imagined them taking, and the genuine danger of a second wave could see the government reassess sick pay as we head into the winter months.”

Rachel Suff, senior policy adviser at the CIPD, is also calling for change, illustrating the pressure from various quarters on the government to reconsider its approach to SSP. “The pandemic has highlighted the economic insecurity and genuine poverty of millions of low-paid people in the UK. The very low level of statutory sick pay means many could feel they simply can’t afford to self-isolate when they need to,” she says. “Millions don’t even qualify for SSP as their annual earnings fall below the minimum earnings limit. 

“So the government should actively consider raising the SSP level to be significantly closer to the equivalent of someone earning the national living wage and making it available to all, including the self-employed.” 

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