SSP Changes April 2026: Day-One Sick Pay [Employer Guide]

What are the SSP changes in April 2026?

The Employment Rights Act 2025 introduces three fundamental changes to Statutory Sick Pay from 6 April 2026. These are the biggest SSP reforms since the scheme was created and affect every UK employer.

These changes mean more employees will receive SSP, SSP starts sooner, and employers need to update payroll systems, policies, and budgets.

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Why is SSP changing?

The UK Government's position is that the current SSP system fails the lowest-paid workers:

• 908,000 employees earned below the Lower Earnings Limit and received no SSP at all (DWP estimate, 2024)
• The 3-day waiting period forced workers to choose between coming in sick or losing 3 days' pay
• The flat rate could exceed the earnings of very low-paid workers, creating a perverse incentive

The reforms are part of the Employment Rights Act 2025, which received Royal Assent in October 2025. The SSP provisions come into force on 6 April 2026 via secondary legislation.

Source: Employment Rights Act 2025

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How does day-one SSP work?

From 6 April 2026, there are no waiting days. SSP is payable from the first qualifying day an employee is off sick.

Before April 2026

Employee off sick Monday to Friday (5-day worker):

• Monday, Tuesday, Wednesday = waiting days (unpaid)
• Thursday, Friday = SSP payable (2 days × £23.75 = £47.50)

After April 2026

Same scenario:

• Monday to Friday = SSP payable from day 1 (5 days × £24.65 = £123.25)

The 4-consecutive-day rule is also abolished. Employees no longer need to be off for 4+ days to qualify. Even a single qualifying day of sickness triggers SSP entitlement (subject to proper notification).

This is a significant change for employers. Every absence spell now costs SSP from day one, which will increase costs particularly for organisations with high short-term absence rates.

Source: GOV.UK — Statutory Sick Pay changes

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How does the 80% AWE cap work?

The 80% Average Weekly Earnings (AWE) cap prevents an employee from receiving more in SSP than they would earn while working. Here is the calculation:

1. Calculate the employee's average weekly earnings over the 8-week reference period ending on the last normal payday before the sickness started
2. Calculate 80% of AWE
3. Compare with the flat SSP rate (£123.25)
4. Pay whichever is lower

Worked examples

Employee A — earns £136.33/week average:

• 80% of £136.33 = £109.06
• Flat rate = £123.25
• SSP = £109.06 (80% AWE is lower)

Employee B — earns £240/week average:

• 80% of £240 = £192.00
• Flat rate = £123.25
• SSP = £123.25 (flat rate is lower)

Employee C — earns £80/week average (previously ineligible):

• 80% of £80 = £64.00
• Flat rate = £123.25
• SSP = £64.00 (80% AWE is lower)

The breakeven point

The breakeven where 80% of AWE equals the flat rate:

£123.25 ÷ 0.80 = £154.06 per week

• Earning £154.06+/week: full flat rate (£123.25)
• Earning below £154.06/week: 80% of their AWE

Source: GOV.UK — Rates and thresholds for employers 2026 to 2027

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What is the new SSP rate for 2026/27?

The 3.8% rate increase (£118.75 to £123.25) is relatively modest, but the removal of waiting days and the LEL are the changes that will have the biggest practical impact.

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What do employers need to do NOW?

1. Update payroll systems

Your payroll software needs to handle:

• No waiting days — SSP calculation starts from qualifying day 1
• No LEL check — remove the earnings eligibility test
• 80% AWE comparison — new calculation logic comparing 80% of AWE against the flat rate
• New rate — £123.25 per week from 6 April 2026

Contact your payroll provider to confirm their April update covers all three changes. Most major providers (Sage, Xero, Moorepay, BrightPay) have announced updates.

2. Review and update sickness absence policies

Your employee handbook should be updated to reflect:

• SSP is payable from day one of sickness absence
• All employees qualify regardless of earnings level
• Lower earners receive 80% of their average weekly earnings
• The employer's notification requirements (now more important since day-one absences trigger SSP)

3. Brief line managers

Managers need to know:

• They can no longer tell employees "the first 3 days are unpaid"
• All employees now qualify for SSP, including part-time and low-paid workers
• The importance of accurate absence recording from day one

4. Budget for increased costs

Model the financial impact using your absence data:

• Additional cost per absence spell: up to 3 extra days of SSP (max £73.95 per spell for a 5-day worker)
• Newly eligible employees: workers who previously earned below the LEL will now receive SSP
• Organisations with high short-term absence rates will see the largest increase

5. Update absence notification procedures

With SSP payable from day one, every absence needs to be captured accurately. Review your:

• Absence reporting process (phone, app, manager notification)
• Self-certification forms
• Fit note tracking for absences beyond 7 days

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How do linked periods work?

Two periods of sickness separated by 56 calendar days or fewer remain linked and treated as one period of incapacity for work. The key implications:

• The 28-week SSP clock does not restart for linked periods
• Since waiting days are abolished, the main effect is on the 28-week maximum
• Employers should track linking periods carefully to avoid overpaying beyond 28 weeks

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What about employees already on SSP on 6 April 2026?

Transitional protections apply:

• They receive the new rate (£123.25 or 80% of AWE) from 6 April
• Waiting days already served are not retrospectively credited — no backdated payments
• The 28-week maximum continues from the original start date
• New periods of sickness after 6 April follow the new rules in full

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What other statutory rates change in April 2026?

Source: GOV.UK — Rates and thresholds for employers 2026 to 2027

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Impact on occupational sick pay schemes

If your organisation offers an occupational (contractual) sick pay scheme that tops up or replaces SSP, review how the changes interact:

• Top-up schemes (e.g. full pay for X weeks, then SSP): The SSP element now starts from day one, which may affect when the top-up kicks in
• Offset schemes (e.g. full pay minus SSP): The SSP deduction now applies from day one
• Qualifying service for occupational sick pay: Review whether your scheme's qualifying criteria need updating given that SSP itself no longer has an earnings threshold

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How Grove HR automates SSP compliance

Grove HR automatically applies the new SSP rules from April 2026:

• Day-one SSP calculation with no waiting days
• Automatic 80% AWE comparison against the flat rate for each employee
• LEL check removed — all employees included in SSP calculations
• Linked period tracking with the 56-day linking rule
• Fit note reminders when medical evidence is due
• Absence dashboards showing SSP cost impact
• Policy template updates reflecting the new rules

Get started with Grove HR and automate your SSP compliance.