Sick Benefits
Sick pay is payable where the employee is unable to do work employed to do due to illness or injury.
Where there is no express provision or implied term to the contrary the Common Law presumes a contractual right to sick pay at normal rate of pay (inclusive of Statutory Sick Pay - S.S.P.) for a reasonable period (i.e. general practice in industry concerned).
In some industries it is common practice not to make any payments other that S.S.P. Where this occurs the self-certification procedure applies for the first seven calendar days of sickness and medical certificates cannot be demanded unless absence extends beyond that period (S.S.P (Medical Evidence) Regulations 1985 – S.I 1985 No 1604)
Where the Employer makes payments in addition to S.S.P it is wise to have a formal Sick Pay Scheme. This should be discretionary rather than contractual and it is recommended that the P.B.S precedent be used.
In having a formal scheme the Employer can demand medical certificates from the first day of absence rather than having to wait 7 days and this can reduce the risk of the scheme being abused. It also helps to monitor more closely any particular employee’s absence record with a view to counselling being available if necessary.
An overview of the SSP Scheme can be obtained from the Employer Helpbook for Statutory Sick Pay at www.hmrc.gov.uk/helpsheets/e14
There is an Employer’s Helpline on 08457 143143 for guidance on S.S.P issues.
Employers can elect to opt out of fully operating the SSP Scheme where they have their own Occupational Sick Pay (OSP). If this does not apply they are responsible for paying SSP to employees who meet certain qualifying conditions.
Those qualifying conditions are as follows and they must all be met to enable SSP to be paid:
• they must be your employee and have done some work under their employment contract before going off sick
• they must be incapable for work for at least four days or more in a row
• they must have a least one Qualifying Day in each week
• their earnings must be at least as much as the lower earnings limit for National Insurance Contributions
• they must have notified you about their sickness in accordance with your rules on absence or within 7 days of the first day of sickness
• they must provide you with medical evidence of their sickness if you require it
SSP is only payable after three Qualifying Days have elapsed.
An SSP calculator is available at www.businesslink.gov.uk/statutorysickpay which will help employers to establish if employees are entitled to SSP and if so, provide a schedule of payments that should be made to them.
The calculator will also help employers to work out if they are entitled to recover any of the SSP they have paid to all employees in each tax month. This is called the Percentage Threshold Scheme (PTS) and the process is covered step by step in the Employer Basic PAYE tools.
Where sick pay results from an accident caused by a third party who may be liable to the employee in damages there is provision in the PBS Staff Handbook for the Employer to recover any payments made to the employee provided they are made by way of a loan. If the situation arises P.B.S will provide a suitable Loan Form for signature by the employee before payments are made.
Where the employee has not exhausted entitlement to sick leave the Employer cannot dismiss the employee unless there is a reason for the dismissal. (Halfpenny v I G E Medical Systems (1999))
All PBS information sheets are designed to provide the detail you need to implement best business and employment practices. They are not a detailed commentary on the current law and where advice is needed in a specific case you should contact PBS for expert consultation.
sick benefits