Under standard rules in the UK employers do not have to pay statutory sick pay (SSP) to an employee until the fourth gualifying day in the Period of Incapacity for Work (PIW). The PIW is a period of sickness lasting four or more consecutive calendar days, not all of which may be qualifying days. The standard rule, therefore, is to look at the PIW, look at the qualifying days and the first three are called waiting days.

During the coronavirus pandemic, the government suspended the three-day wait for COVID-related SSP, meaning that employers must pay it from the first qualifying day.

The amendment to the SSP rules was made in the Coronavirus Act 2020 which contains an expiry date, under which the suspension of the general law will cease two years after the date of Royal Assent. This means that, unless there is an intervention to continue the measure, coronavirus-related SSP waiting time will automatically revert to three days on 25 March 2022.

In this event employers will need to:

• Consider two weeks before the end of the 2021/22 tax year any changes that their payroll software may have made to accommodate the suspension of waiting days. This will have the effect of removing "coronavirus-related SSP" and reintroducing waiting days for all absence types.
• Tell employees claiming coronavirus-related SSP from 25 March 2022 that their SSP will be paid from the fourth day qualifying day in the PIW, not from day one.

Following the suspension of the waiting period, small employers were able to recover the cost of the additional three days SSP from HMRC under the SSP recovery scheme (SSPRS) but, this scheme ended at the end of September and from this date employers must cover the additional costs themselves. Any outstanding claims under the SSPRS must be submitted by the end of this year (see HMRC’s guidance).

The Tax Faculty believes that the disparity between waiting days and reimbursement reveals there are two sides to this issue which seem to have become disconnected in the policymaking.

Frank Haskew, Head of ICAEW Tax Faculty said: “The SSP rules were not really designed with a highly infectious global pandemic in mind, which is why the current easements have been welcome. While some employees, who are ill from coronavirus or required to self-isolate, may be unable to afford not to go to work unless they are paid SSP for the first three days, there are also small businesses where the unreimbursed cost of paying three days’ coronavirus-related SSP to employees is a real burden.”

Legislation

• Coronavirus Act 2020 section 40 (the power to suspend the waiting days).
• Statutory Sick Pay (Coronavirus) (Suspension of Waiting Days and General Amendment) Regulations 2020, SI 2020/374 (made under s40(1)-(4)).
• Statutory Sick Pay (Coronavirus) (Suspension of Waiting Days and General Amendment) (No 2) Regulations 2020, SI 2020/681 (made under s40(1)-(3)).
• Coronavirus Act 2020 section 89 (expiry).