Statutory Sick Pay Changes: What Employers Need to Know Ahead of April 2026

We’ve known for some time that significant changes to Statutory Sick Pay (SSP) are coming into force from 6 April 2026. These reforms represent one of the biggest shifts in SSP in years and are designed to widen access and provide earlier financial support to employees who are unwell. 

While the headline changes have been clear for a while, one key question remained unanswered: what happens to employees who are already off sick when the new rules take effect? 

That uncertainty has now been resolved, with eligibility and transitional protections confirmed. Here’s what employers — particularly small businesses — need to know. 

The Key Changes to Statutory Sick Pay 

1. Removal of the Lower Earnings Limit (LEL) 

The Lower Earnings Limit will be abolished, meaning all employees will be eligible for SSP regardless of their earnings. This brings many lower-paid, part-time, and variable-hours workers into scope for the first time. 

What this means for small businesses: 
For small employers, particularly those with part-time staff, casual workers, or seasonal teams, this change will likely increase the number of employees eligible for SSP. Businesses that previously didn’t pay SSP at all may now need to budget for it, review payroll settings, and ensure managers understand that eligibility is no longer earnings-based. 

2. New SSP Calculation Method 

SSP will be paid at 80% of an employee’s Average Weekly Earnings (AWE) or the current flat rate, whichever is lower. This introduces a more earnings-related approach while keeping a cap in place. 

What this means for small businesses: 
While this change offers greater fairness for lower earners, it also adds complexity to payroll calculations, particularly for employers without dedicated payroll teams. Small businesses may need to rely more heavily on payroll software or external providers to ensure SSP is calculated correctly — especially where earnings fluctuate. 

3. No More Waiting Days 

Waiting days will be removed entirely. Eligible employees will receive SSP from the first full day of sickness absence, rather than waiting until day four. 

What this means for small businesses: 
The removal of waiting days is likely to have the most immediate financial impact on small employers. Short-term absences that previously didn’t attract SSP will now be payable, increasing costs and potentially affecting cash flow. It also places greater importance on having clear absence reporting procedures and prompt payroll processing. 

What About Employees Already Off Sick on 6 April 2026? 

This was the biggest unknown — and one that caused understandable concern for many employers. Clear transitional protections are now in place. 

Expanded Eligibility 

Employees earning below the LEL who are off sick on or after 6 April 2026 will now qualify for SSP, even if they wouldn’t have done so previously. 

Impact on small businesses: 
Small businesses may find themselves paying SSP to employees who historically wouldn’t have qualified. This reinforces the need to review absence budgets and ensure managers are aware that historic rules no longer apply. 

Waiting Days in Progress 

If an employee is serving waiting days on 6 April 2026, SSP will become payable from that date onwards. 

Impact on small businesses: 
This avoids complex backdating but does mean employers need to be alert to transition dates. Payroll teams (or outsourced providers) should be prepared for SSP payments to begin immediately on 6 April, even where waiting days haven’t been completed. 

Transitional Protection for Existing SSP Recipients 

Employees already receiving SSP before 6 April 2026 will be protected from a reduction in their SSP rate. They will continue to receive the uprated flat rate until they return to work, exhaust their entitlement, or their employment ends. 

Impact on small businesses: 
While this protects employees, it also provides certainty for employers. Small businesses won’t need to recalculate SSP mid-absence or manage difficult conversations about reduced payments, which helps reduce administrative burden and employee relations risk. 

Employees Earning Between £125.00 and £154.05 Per Week 

Employees in this earnings band who were already off sick and receiving SSP before 6 April 2026 will continue to receive the flat rate of £123.25 during that continuous sickness absence. 

Impact on small businesses: 
This avoids a sudden drop in SSP for affected employees, helping maintain trust and morale. For employers, it means predictable SSP costs during long-term absences rather than fluctuating rates. 

How SSP Will Be Calculated Going Forward 

With the move to an earnings-based calculation, payroll accuracy becomes even more important. 

Average Weekly Earnings (AWE) 

• SSP for those earning below the flat rate will be based on 80% of AWE 

• AWE will be calculated over a relevant 8-week period 

• Payments will be rounded up to the nearest whole penny 

What this means for small businesses: 
Employers with variable pay patterns will need to ensure their payroll systems can correctly calculate AWE. For smaller businesses, this may mean checking payroll software capabilities or speaking with payroll providers well in advance of April 2026. 

Linked Periods of Incapacity 

Where sickness absences are linked within 56 days, the AWE from the initial period will be used for future SSP calculations. 

What this means for small businesses: 
This provides welcome consistency, but it also means accurate absence tracking is essential. Small businesses should ensure sickness records are up to date and well documented, particularly where absences are recurring. 

What Should Small Businesses Be Doing Now? 

Although April 2026 may feel a long way off, these changes will have a real operational and financial impact. Small businesses should consider: 

• Reviewing payroll systems and SSP processes 

• Budgeting for increased SSP eligibility and earlier payments 

• Training managers on the removal of waiting days 

• Updating sickness and absence policies 

• Communicating clearly with employees about what SSP will look like going forward 

With the right preparation, these changes don’t need to be overwhelming — but leaving it too late could be costly. 

If you’d like support reviewing your policies or preparing your business for the SSP changes ahead, now is the perfect time to book a discovery call with us. 

We are also running free webinars on this topic on Wednesday 25th February 2026 and Friday 6th March 2026. You can sign up here.