INTRODUCTION

Statutory Sick Pay (SSP) is a benefit paid to a person in employment, earning £87 per week or more, who falls ill (whether due to physical or mental disablement) for a period of four days or more. The employer is responsible for paying SSP.  SSP is payable for up to 28 weeks (in any period of incapacity separated from a previous period of incapacity by more than eight weeks) at a rate of £72.55.

The National Insurance Contributions Office of Her Majesty’s Revenue & Customs (HMRC) is responsible for disputes concerning entitlement to SSP. Issues about SSP are submitted to an officer of the board of HMRC for determination. The individual may also in certain circumstances complain to an industrial tribunal about an unlawful deduction from wages or sue in the county court for breach of contract.

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1. Who can claim?

Only those in employment with earnings equal to or more than the lower earnings limit of £87 per week can claim SSP. The definition of ‘employee’ in this legislation is wider than that in other areas and includes most workers. However, a recent Court of Appeal decision has confirmed that an agency worker whose contract is for a specified period of three months or less is not entitled to SSP.  A self-employed or unemployed person cannot claim SSP. S/he must claim Incapacity Benefit which will be payable only if s/he satisfies the appropriate national insurance contribution conditions.

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2. Qualifying conditions

In order to claim SSP, the main qualifying conditions must be met. The day of sickness must:

2.1 A period of incapacity for work

The first qualifying condition for SSP is that the day on which illness is occurring must be within a period of incapacity for work (PIW). 

This means that the person must be incapable of doing the job because of sickness or disability or unable to attend work due to the operation of public health legislation to prevent the spread of infectious disease for at least four or more days in a row. Sundays and public holidays are counted.  SSP is not payable for the first three days.

PIWs that are eight or less weeks apart are linked and count as one single PIW. This is useful given the fact that the first three days of any PIW are 'lying days', ie no benefit is payable. Therefore, if a person is sick for five days, SSP is only payable for the last two days of that PIW. If, however, s/he falls ill again for another five days only six weeks later, this new period is linked with the old PIW and benefit is payable for the whole five days of this new spell of incapacity.

2.2 A period of entitlement

The second qualifying condition is that the day of incapacity must fall within a period agreed between the employer and employee as a period of entitlement. This simply means there must be a period of time when the person is entitled to SSP and not excluded from receiving SSP. The period of entitlement starts at the time of the PIW and ends when the employer has no further liability to pay SSP.

The employer is no longer liable to pay SSP if the person:

Note: An expectant or new mother up until the baby is six months old or a breastfeeding mother (regardless of how old the child is) suspended from work due to risks to health and safety identified by a risk assessment may be entitled to full pay where the employer is unable to alter the employee’s working conditions or hours of work.

2.3 Qualifying days

SSP is only payable for days that are qualifying days, ie days that the person would normally have been required to have been available for work under the terms of the contract of employment.

If the working pattern varies from one week to another, eg shift work, the person and her/his employer can arrange which days in any one week are qualifying days. There must always be one qualifying day in each week. In the event of the parties failing to reach agreement as to what days should be qualifying days, then qualifying days will be the days that the contract would have required the person to work if s/he was not sick. If it is not clear which days would have been working days in a particular week, then regulations state that every day of the week, except days agreed as rest days, will be the qualifying days for SSP purposes. If the person would not normally have worked in a particular week and has no agreement with the employer as to what are qualifying days, then Wednesday of that week will be a qualifying day regardless of anything else.

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3. How Much is Payable?

SSP is payable at a standard rate of £72.55 per week on earnings of £87 per week or more. SSP is a flat-rate benefit with no additions for any dependants. It is also subject to tax and national insurance contributions.

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4. Payment of Statutory Sick Pay

SSP should normally be paid at the same time and in the same way as wages would have been paid, ie a normal payday. Where there is no agreement or normal practice on which day payment is to be made, SSP should be paid at least on the last day of the month. SSP can be collected personally, or by someone nominated by the person claiming. S/he could also ask for it to be sent out by giro cheque or cheque.

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5. Claiming Statutory Sick Pay

5.1 Notification

The first step in claiming SSP is to notify the employer of the illness. The employer can decide on a manner in which notification is to be given. The employer must take reasonable steps to make the manner of notification known to the employee. The employer's rules on notification should comply with HMRC guidelines. The employer cannot insist on notification being given personally. S/he must accept it from someone else on behalf of the person claiming. For the first seven days, self-certification is sufficient and the person cannot be made to give notification in the form of medical evidence. Nor can the employer require her/him to complete a special form at any time during the claim. If notification is sent by prepaid post, the employer should treat it as having been given on the day it was posted. The employer cannot demand notification more than once in every seven days.

Note: There may be a provision in the contract for company sick pay at a higher rate of SSP.  In such a case, to qualify for any amount over what would be payable as SSP, the employee would have to follow the employer’s rules.  Such rules could be more stringent than the rules on SSP.

5.2 Late notification

Providing the employer's rules comply with HMRC guidelines, a person can be disqualified from receiving SSP for any day of incapacity notified late. SSP can be payable if the employer accepts that there was good cause for late notification. 

Generally speaking, an employer should accept notification of a qualifying day of incapacity for work so long as it is given in writing no later than seven days after that day. If the employer does not pay out because s/he does not believe that there was good cause for the delay, the person can ask HMRC for a decision.

5.3 Evidence of incapacity for work

After the first seven days of self-certification of incapacity for work, the employer is entitled to seek reasonable evidence of a person's illness. The usual evidence of incapacity for work is a doctor's line issued by a general practitioner (GP). 

5.4 Terms and conditions relating to sickness

An employee employed for more than one month is entitled to be provided by her/his employer with a statement of initial employment particulars within two months of starting employment. The statement must include any terms and conditions relating to incapacity for work due to sickness or injury, including any provision for sick pay. Where the employer fails to provide the initial statement of particulars, an employee can make a reference to an industrial tribunal. In limited circumstances, compensation is provided to an employee due to her/his employer failing to provide an initial statement.  The tribunal can also determine the particulars which ought to have been included by the employer. The matter can be referred to an industrial tribunal whilst the employment continues or within three months of the date on which employment ceased (see Law Centre (NI) Encyclopedia of Rights, C.1, Rights of Employees, section 4.6).

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6. Short Illnesses

If a person is frequently off sick for periods of less than seven days, most of the absences will be self-certified.  If s/he has had at least four self-certified illnesses over twelve months and the employer does not believe that the person has been incapable of work, the employer may want to discuss the matter. This could involve the person (with consent) being sent to the company doctor.

If there are any doubts, the employer may refer the case to HMRC for help. HMRC will contact the person’s GP who will be asked, with the employee’s consent, to give a medical report to the regional medical officer (RMO).  The RMO will then be asked to give an independent medical opinion which will be forwarded to HMRC who will then make a formal decision on the person's capacity for work and whether or not there are reasonable grounds for the employee having frequent absences from work for medical reasons.

The employer will not receive the RMO's report. Instead, s/he will be told whether or not the person is fit for work. If there is a decision of fitness for work, the employer will stop SSP and the person will have the right to appeal.

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7. Lengthy Absences

If the employer feels that a person has been off work for a long time given the nature of her/his stated incapacity, then s/he may ask HMRC for an opinion on the person's continuing incapacity for work. HMRC help is reserved for cases where the employer has been unable to make her/his own arrangements to get more medical evidence but the case can only be referred to HMRC with the person's consent.

If HMRC agrees to help, the case is referred to the RMO who, after consulting with the person's own GP, may ask her/him to attend a medical examination carried out by the Medical Support Service. The employer will not be given a copy of this medical, but will just be told whether or not the person is capable of work. This is not a decision. It is only a guide as to whether or not SSP should remain in payment. If the employer stops SSP, then the person has the right to approach the HMRC officer for a decision.

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8. Disputes over incapacity for work

If an employer does not accept that a person is incapable of work, the employee has the right to ask for a written statement of the reasons for this belief. This will include the dates when SSP will not be paid. HMRC can also be approached by the person for a decision.  An application for a decision by HMRC must be made within six months of the earliest date for which the entitlement to SSP is in dispute.

Both the parties involved will be asked to send in written comments to HMRC. The person claiming can also send in any further medicals. There is no oral hearing. HMRC will make a decision and send copies of it to both parties. If HMRC decides that SSP should be payable, the employer, unless s/he is going to appeal, must repay SSP. If HMRC states that the person is capable of work, s/he also has the right to appeal.

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9. Non-payment of SSP by employers

If HMRC rules that SSP is payable and an employer still refuses to pay, the responsibility for paying SSP can be transferred to HMRC.

9.1 Appeals

Appeals are made in writing to HMRC. When an appeal is made, HMRC reviews the decision and may decide to change the decision.  The person making the appeal is informed and has the opportunity to accept the varied decision or to have the appeal heard by an independent tribunal. Appeals are heard by appeal commissioners who can be non-legally qualified general commissioners or legally qualified special commissioners. The person making the appeal can choose which type of commissioners should determine the appeal. Appeals by either the employer or the person claiming must be made within 30 days of the date of issue of the notice of decision.  Further appeal by the person claiming, employer or HMRC is to the High Court on a point of law.

9.2 Protection of wages

SSP is treated as wages. Provided there is no dispute over whether an employee is actually entitled to SSP, an employee may complain to an industrial tribunal if her/his employer fails to pay SSP.  The employee will claim for unlawful deductions from wages specified in the Employment Rights (Northern Ireland) Order 1996 (see Law Centre (NI) Encyclopedia of Rights, C.1, Rights of Employees, 6.3).  The complaint must generally be presented within three months of the failure to pay the last instalment of SSP due but the employee must comply with recently introduced statutory procedures (see Law Centre (NI) Encyclopedia of Rights, C.1, Rights of Employees, section 5).  Following these procedures may affect the time limit.  The tribunal can order the employer to pay the SSP due as wages. Such a claim can only be brought in cases where there is no dispute over entitlement to SSP but payment has not been made. Dispute over entitlement (according to the Employment Appeal Tribunal in Taylor Gordon & Co Ltd v Timmons [2004] IRLR 180) lies with HMRC, not an industrial tribunal.

9.3 Breach of contract

A person who qualifies for SSP may bring a complaint for breach of contract if her/his employer fails to pay SSP. The right to SSP may be treated as a contractual term implied by statute. Where the employment has ended, the claim for breach of contract may be brought to an industrial tribunal.

The time limit for bringing the claim in the industrial tribunal is generally three months from the failure to pay SSP but the employee must comply with recently introduced statutory procedures (see Law Centre (NI) Encyclopedia of Rights, C.1, Rights of Employees, section 5).  Following these procedures may affect the time limit.

Where the employment continues, the claim for breach of contract cannot be brought in the industrial tribunal. (However, as stated at paragraph 9.2 above, where employment continues, a claim for unlawful deductions of wages can be made in the industrial tribunal). A claim can be brought in the county court by way of Application for Arbitration, commonly referred to as a small claims action, within six years of the breach of contract.

Note: It should be noted that, where an action is brought for breach of contract, an employer may counter-sue against the employee claiming damages for any loss s/he has suffered. The damages claimed by an employer may be substantially more than what the employee is claiming.

9.4 Unfair dismissal

A person dismissed because s/he:

will be treated as automatically unfairly dismissed.

Such an employee does not require any period of continuous employment to claim unfair dismissal. The complaint of unfair dismissal must be presented to an industrial tribunal within three months of the dismissal.  The employer should normally follow statutory disciplinary and dismissal procedures (see Law Centre (NI) Encyclopedia of Rights, C.1, Rights of Employees, section 5).  If these are followed the time limit for presenting a claim can be affected.

9.5 Disability discrimination

A person who suffers from a disability (ie a physical or mental impairment which has a substantial or long term effect on her/his ability to carry out normal day to day activities) may have a remedy under the Disability Discrimination Act 1995 (DDA) if the employer:

A person in this situation should seek legal advice immediately.

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10. Miscellaneous

10.1 Occupational sick pay

If an employer has her/his own occupational sick pay scheme, payments made under that scheme count towards a person's SSP entitlement (and vice versa).  If, however, the occupational sick pay scheme pays less than the full SSP, the employer must make up the balance so that all the SSP due is paid.

10.2 Effect on other benefits

SSP is not payable when a person is receiving other national insurance benefits but it can be topped up with Income Support and/or Housing Benefit. It can be paid on top of Attendance Allowance, Disability Living Allowance, basic war or industrial injury benefits and bereavement benefits.

10.3 Hospitalisation

Hospitalisation will not affect entitlement to SSP.

10.4 Earnings from another job

A person can earn money from a different type of work while receiving SSP providing the employer paying SSP agrees that s/he is incapable of doing her/his job eg a typist breaks her hand and cannot type but she might be able to do work as a bingo caller until her hand heals.

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11. Transfers to State Benefits

If entitlement to SSP ends and a person is still incapable of work, s/he may be able to get Incapacity Benefit depending on her/his national insurance contributions record. The transfer is effected by the employer completing section 1 of form SSP1, which should be given to the person, together with any medical certificates covering the period for which there is no entitlement to SSP. The person should complete sections 2 to 4 and forward the form to the Incapacity Benefits Branch, Castle Court , Belfast .

If Incapacity Benefit is not payable and the person still remains ill, s/he can claim Income Support. The disability premium of Income Support becomes payable after 364 days of incapacity or, where a person is terminally ill, after 196 days of incapacity.

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12. Further Information

 Welfare Benefits and Tax Credits Handbook, 9^th Edition, CPAG, 2007/2008, £35.00.

Disability Rights Handbook, 31^st Edition, The Disability Alliance ERA 2006/2007, available from Disability Alliance, Universal House, 88-94 Wentworth Street, London, E1 7SA, £19.00.

A useful SSP manual for employers can be accessed at: www.hmrc.gov.uk.

HMRC operates an employers’ helpline which provides guidance on all aspects of SSP.  The telephone number is 0845 7143 143.

© Law Centre (NI) July 2007

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