The UK Employment Rights Bill 2026 introduces major updates to Statutory Sick Pay (SSP) that every UK employer should start planning for now. Although the reforms take effect from 6 April 2026, businesses need time to prepare for higher absence costs and tighter Fair Work Agency enforcement. At the time of writing, SSP is £118.75 per week —and because it can rarely be reclaimed, it is a direct cost to employers.

What Will Change From 6 April 2026

The Statutory Sick Pay reforms include four headline changes:

• Day-one SSP entitlement– employees will qualify for SSP from the first day of sickness, ending the current three waiting days
• Lower Earnings Limit removed– around 2–1.3 million low-paid workers who earn below the current LEL will now qualify for SSP
• New SSP calculation rule– employees will be paid the lower of 80% of their average weekly earnings or the flat SSP rate. This gives low earners a payment closer to their normal wage but caps costs at the statutory flat rate
• Fair Work Agency enforcement– the newly created agency will have powers to inspect, audit and enforce SSP compliance

What should you do?

If your organisation only pays SSP for sickness absence, your staff costs will rise. For each employee, absence separated by more than eight weeks could increase costs by up to 60% of £118.75.

To protect profit margins:

• Model the financial impact now, using your current absence rates
• Review your sickness policy and staff handbook so references to absence thresholds and payments match the new rules
• If you provideenhanced sick pay, make sure your documentation clearly distinguishes the SSP element and that payroll records it correctly
• Communicate clearly with your payroll provider—check their software can:
  • start SSP from day one
  • pay 80% of average weekly earnings capped at the flat rate, and
  • include employees previously below the LEL

Strengthen Absence Management:

Many employers expect an increase in short-term sickness absence once day-one SSP starts.

Protect productivity by:

• Setting out a clear absence management policy,
• Training managers to apply the policy consistently, and
• Keeping accurate records for potential Fair Work Agency inspections.

Key Takeaway

The Employment Rights Bill 2026 will transform Statutory Sick Pay.

Preparing early—by reviewing policies, updating payroll systems and training managers—will help UK employers stay compliant and control the impact of rising SSP costs.

If you’d like to talk to us about these changes and how best you can prepare for them, please get in touch.