Sick pay repayment scheme for employers with higher levels of absence ends

Out-Law News | 10 Apr 2014 | 4:52 pm |

UK employers that experience higher than average levels of employee sickness are no longer able to reclaim a proportion of their statutory sick pay (SSP) expenditure from the government.

Under the previous SSP percentage threshold schemes, employers in Great Britain and Northern Ireland had been able to reclaim SSP paid out in any given month that exceeded 13% of their national insurance contributions (NICs) for that month.

As previously announced, the money that will be saved by abolishing the percentage threshold schemes will be used to fund a new Health and Work Service, which will offer occupational health assessments and advice to help employees absent from work due to long-term illness back into the workplace. The new service is expected to begin operating in April next year.

The government has estimated that this new service will save employers £70 million a year and cut the time people spend off work by as much as 40%; "more than likely" offsetting the costs to businesses of the end of the "outdated" percentage threshold schemes.

Transitional provisions will allow employers to continue recovering SSP in respect of absence falling before the schemes were abolished on 6 April 2014 until 6 April 2016, according to the statutory instrument that brought the changes into force (4-page / 34KB PDF).