By Mark Higgins, Employment Law Partner, Ralli Solicitors LLP
The UK government has embarked on a mission to make the Statutory Sick Pay (SSP) system more inclusive and responsive, particularly for low-paid and insecure workers. As of 6th April 2025, one of the first key reforms has now come into effect: an increase in the SSP flat rate from £116.75 to £118.75 per week.
While the figure is relatively modest, it forms part of a broader strategy aimed at modernising sick pay, closing protection gaps for vulnerable workers, and ultimately encouraging a healthier and more equitable working environment.
The new SSP rate: small step, big impact
The rise in the SSP rate to £118.75 per week marks the first change to the benefit in over a year and signals the government’s recognition that current rates have failed to keep pace with inflation and living costs. For employers with large workforces, this increase may lead to significant cost pressures.
For many workers, particularly those already on tight budgets, this increment can provides (albeit marginal) improved financial stability during periods of illness. However, even at the new rate, SSP remains one of the lowest statutory sick pay schemes in Europe – an issue that campaigners continue to raise and of which all employers need to be aware.
Looking ahead: reforms on the horizon
Beyond this confirmed rate increase, the government is consulting on further changes that would bring more substantive reform, including:
Abolishing the Lower Earnings Limit (LEL)
Currently, workers must earn at least £123 per week to qualify for SSP. This threshold excludes approximately 1.3 million low-paid workers, including many on zero-hours contracts and part-time roles. Proposed reforms would eliminate this barrier, bringing previously excluded workers into the SSP system.
SSP from day one
Under current rules, SSP is only payable after three ‘waiting days’. The government is considering a shift to pay SSP from the first day of illness, recognising the public health risks posed when sick workers feel compelled to attend work to avoid income loss.
Proportional pay for low earners
Another reform under consideration is introducing an earnings-linked model for those earning below the standard weekly SSP amount. Instead of the flat rate, these workers would receive 80% of their average weekly pay – which is perceived as a fairer approach that better reflects the income reality for low-wage earners.
The employer’s dilemma
While these reforms reflect a genuine effort to modernise workplace rights, employers – particularly SMEs – may find themselves grappling with increased costs and administrative burdens. Employers will need to:
- budget for SSP payments to a larger proportion of staff;
- prepare for SSP to begin immediately when an employee falls ill;
- adjust payroll systems to accommodate earnings-linked calculations (if implemented);
- ensure employment contracts and absence policies are reviewed and compliant.
What should employers be doing now?
The SSP rate increase is already in place. The further proposed changes, while not yet enacted, are likely to gain traction over the coming months. We recommend that employers:
- stay updated on legislative timelines;
- begin reviewing workforce data to understand who may be affected;
- educate HR teams and line managers on likely changes;
- consider updating internal procedures and systems now to avoid a scramble later.
We’re here to support employers
As always, dealing with employment law reform requires careful preparation and a proactive mindset. At Ralli Solicitors LLP, we are working with employers across sectors to ensure they are ready for what’s next. For further information contact me directly on 0161 615 0655 or email mark.higgins@ralli.co.uk.
In the meantime, you can learn more about my work with clients on our website here: ralli.co.uk/people/mark-higgins
