The UK government has announced significant changes to statutory sick pay (SSP) as part of its Plan to Make Work Pay, with the aim of improving workers’ rights and creating a healthier, more productive workforce.

The government had already announced plans to make SSP more accessible, but a further change announced on 5 March 2025 introduced two major reforms that will have a profound impact on sick pay , particularly for lower paid workers. HR professionals must be prepared for the implications these changes will have on absence management, costs, and workplace culture.

What’s changing?

1. Sick pay from day one

Currently, SSP in the UK is subject to certain limitations, most notably a three-day waiting period before payments commence. In other words, employees are only entitled to SSP from the fourth consecutive day of absence.

As a result, those who take occasional sick days – one day here, two days there – lose income, potentially leaving them vulnerable to financial strain during brief periods of illnesses.

Under the proposed reforms, SSP will be available from day one of absence, ensuring employees receive financial support from the first day of illness and removing the waiting period. This prevent some individuals from feeling pressured to work while unwell due to concerns over lost income.

This change will be especially relevant to those in lower-wage sectors or part-time roles, where the financial impact of sickness can be particularly difficult.

2. 80% sick pay for lower-paid workers
Another key reform Labour is proposing is the introduction of a new SSP rate of 80% of earnings for employees who earn below a specified income threshold.

This marks a substantial increase from the existing flat rate of SSP (currently set at £116.75 per week), which many have argued is inadequate, particularly for lower-wage workers.

The intention behind the change is to help alleviate financial pressure for those most vulnerable to illness-related income loss, especially in sectors where low wages are prevalent.

When this change comes into effect, it could benefit up to 1.3 million low-paid workers, who will receive either 80% of their average weekly earnings or SSP (£118.75 per week from 1 April 2025), whichever is lower, when they fall ill.

For some of the UK’s lowest earners, the changes could mean an extra £100 per week compared to the current system.

What does this mean for employers?

For employers and HR teams, these shifts present both challenges and opportunities. While the proposed regulations would inevitably lead to increased costs for businesses – especially those that rely on lower-paid, temporary, or part-time staff – they also have the potential to create a more loyal and motivated workforce.

 
By offering workers greater security and support surrounding sickness, employers can improve employee morale, reduce absenteeism, and look to foster a workplace culture based on fairness and care.

 
However, some employers may be concerned that the new benefits could encourage abuse of sickness absence in the workforce, as the current SSP provisions are, to an extent, a deterrent to taking sporadic sick days as employees will not get paid. It’s possible that the government may look to include provisions within the legislation to prevent this – but we’ll have to wait and see.

How should HR teams prepare?

Given concerns that this change could cause an increase in non-genuine absences, organisations should:

• Ensure they have a robust absence management policy in place, with clear triggers for formal action if absences exceed a reasonable level.
• Train managers on effective absence management.
• Implement an absence management system to monitor absences and highlight absence issues; and
• Ensure return to work meetings are undertaken and documented.

For businesses already struggling with high sickness absence rates, these changes could intensify existing issues.

It remains to be seen how these proposed reforms may evolve in the coming months; however, this change is just one of many included in the Employment Rights Bill, which reflects the government’s broader focus on improving workplace fairness across the UK.