Tax experts try to clear up Statutory Sick Pay misinformation

The Low Incomes Tax Reform Group (LITRG) has highlighted that there is a lot of well-meaning but incorrect information about Statutory Sick Pay on the internet and it is important that people use trusted sources to confirm their position.

Employees and workers must receive any Sick Pay (SSP) due to them from the first day of sickness absence, rather than the fourth day, for people who have COVID-19 or have to self-isolate, in line with official guidance. They can ‘self-certify’ for the first 7 days off work. Those self-isolating for more than 7 days can get an online self-isolation note from the NHS website. The SSP is payable for up to two weeks and this can be claimed back from HMRC by the employer.

SSP (£95.85 per week from 6 April) is available for people who are an ’employed earner’ (basically those who are working for an employer who has a liability to pay National Insurance for them) and who earn an average of at least £120 per week. The earnings taken into account are broadly the average weekly earnings for the prior eight weeks. People who earn less than £120 per week or who are self-employed are not entitled to SSP.

Employees that are defined on medical grounds as extremely vulnerable and have been told to self-isolate by a Doctor or NHS 111 are entitled to SSP for up to 12 weeks and should provide their employer with the necessary medical letter confirming this. Currently, only the first 2 weeks’ SSP is reclaimable from HMRC by the employer.

LITRG has clarified the following:

• SSP, as things stand, is payable to people who cannot work because they have to self-isolate following government guidance. The government guidance (as at 24 March 2020) on isolation is limited to those who have symptoms or those who live with someone who has symptoms.
• Currently, the legislation does not appear to extend to people who cannot work because they fall within the ‘social distancing’ or ‘shielding’ measures etc. However, LITRG is discussing this with HMRC.
• The £120 per week limit is per job. You cannot amalgamate earnings over two or more jobs to see if you meet the limit (unless those jobs are with the same employer). On the other hand, if you have two or more jobs and earn at least £120 in both – you can get SSP from both employers.
• SSP is not a ‘worker’ employment law right but rather one that is tied to whether secondary Class 1 National Insurance is payable. This means that agency workers, temporary workers and casual workers who pay their tax and NIC under PAYE may qualify, whereas those in self-employment (even if it is ‘dependent’ self-employment) will not qualify, as they do not pay Class 1 NIC.
• To qualify for SSP you must have done some work under your contract (even if this is just a few hours’ worth). This means that if you are in a new job – you may qualify for SSP even if you have not been paid yet.
• Zero hours contract workers who pay their tax and NIC under PAYE may qualify – provided they have done some work under their contract. Zero hours contract workers who have not yet done any work under their contract, will not be entitled to SSP.
• Part-time workers who earn at least £120 per week, qualify for SSP at the normal full weekly rate – they do not receive a pro-rata amount. So, someone who is self-isolating for two weeks and who normally works five days a week should get £191.70 in total. Someone who is self-isolating for two weeks and who normally works three days a week should also get £191.70 in total.
• SSP is payable until your period of illness/self-isolation ends or until your contract ends (if earlier). Agency workers should be aware that if they have less than three months of continuous service, then SSP is only payable to the end of any agreed assignments.

Technical guidance to help employers understand the rules in complex or unusual situations, such as where they have a new employee without eight weeks of service, or where they cease to trade or become insolvent, is available on www.gov.uk/government/collections/statutory-pay and www.gov.uk/hmrc-internal-manuals/statutory-payments-manual.

Employees can ask their employers for SSP if they think they are entitled to it (agency workers should ask their agency unless they work through an umbrella company, in which case they should ask their umbrella company). They should be able to get an isolation note, if they need one, from the recently launched online facility www.gov.uk/government/news/online-isolation-notes-launched-providing-proof-of-coronavirus-absence-from-work. However for the first seven days off work, employees can self-certify, so they do not need any evidence for their employer.