How is Statutory Sick Pay changing in 2026?

How is Statutory Sick Pay changing in 2026?

18 February 2026 | posted in Payroll

Statutory Sick Pay is changing from 6 April 2026.  There are three major changes to be aware of:

  1. The Lower Earnings Limit is being removed

All employees will be entitled to SSP regardless of how much they get paid.

Currently, employees must earn at least £125 per week to qualify for SSP. The new rules will see all employees eligible for sick pay regardless of their earnings level – extending sick pay coverage for around 1.3 million additional workers.

  1. SSP will be calculated differently

The way SSP is calculated is also changing. Rather than there being one flat rate for SSP payments, employers will pay whichever is lower of the following:

  • 80% of the employee’s average weekly earnings (calculated over the eight-week period prior to the absence) or
  • the uplifted weekly flat rate of £123.25.

  1. SSP will be paid from the first day of sickness absence

The waiting period has been removed, meaning that SSP will be paid from the first full day of sickness absence, and not from day four.

Currently, the first three days of sickness absence are unpaid.

These changes to Statutory Sick Pay affect any absences starting on or after 6 April 2026.  

What are the transitional rules for employees already off sick on 6 April 2026?

The DWP has confirmed how these changes affect employees who are already off sick when the changes come into effect.

Example 1

Lisa earns £150 per week.  She has been off sick since the beginning of March and returns to work on 11 May 2026.  For the absence period prior to 6 April, Lisa received £118.75 per week SSP (based on the 2025/26 flat rate.)

If her absence had started on or after 6 April, she would be entitled to the lower of either;

  • 80% of her average weekly wage – in this case £120
  • the flat rate of £123.50

However, because Lisa is already on sick leave before 6 April, she should receive the uprated flat rate of £123.50 (even though it’s the higher rate) until she returns to work.

Any employees who are already off sick when the new rules come into effect should continue to receive the flat rate of £123.25 until they return to work or exhaust their 28-week entitlement. Their payments should not be reduced to 80% of their average weekly wage, even if this is less than £123.25.

For future absences, Lisa would be entitled to the lower of the two rates.

Example 2

Robbie works part time earning £100 per week. He goes off sick on Thursday 2 April 2026 and returns to work on 9 April 2026.

If an employee who doesn’t currently qualify for SSP (i.e. because they earn less than £125 per week) has an absence period that starts before 6 April and is still off sick on 6 April, they should start receiving SSP from 6 April onwards.

Under the current Lower Earnings Limit rules, Robbie would not be entitled to SSP. However, he is entitled to Statutory Sick Pay from 6 April 2026 onwards, meaning he should receive SSP for the period between 6 and 9 April.

How Moore’s payroll specialists can help

It’s vital that employers understand the new rules and apply them correctly. Even small errors can lead to compliance issues, payroll discrepancies and unnecessary reputational risk. With the added complexity these changes bring about, getting clear, accurate guidance is essential.

If you’re unsure how the new requirements will affect your business, our payroll specialists are here to help – providing expert advice to ensure you stay compliance and avoid costly mistakes.  Get in touch today or call our payroll team on:

Contributors

Tamsin Clark

Payroll Manager Corby, Peterborough and Northampton

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