April 2026 has seen some of the more profound changes from the Employment Rights Act take effect, with many payroll systems being placed under greater strain.
Businesses should have already made provisions to be compliant, but not every change is fully understood.
To avoid compliance issues, businesses should look again at the changes to Statutory Sick Pay (SSP) to ensure they know how to manage them.
How have the changes to Statutory Sick Pay affected payroll?
Hailed as the biggest change since 1985, the new approach to SSP has left the payroll processes of many businesses under more strain than before.
This is mostly due to the expansion of eligibility for SSP that pulls in more employees than ever before and removes the traditional three-day waiting period in which people would go unpaid.
The removal of the Lower Earnings Limit (LEL) now means that lower-paid and part-time employees qualify for SSP where they did not before.
Smaller businesses may be finding it more challenging to payroll the estimated 1.3 million more people who now can access SSP than before.
New calculations add further complexity as most employees will now be paid at the lower of either:
To calculate the required sick pay each employee is entitled to, you will need to:
Given the upfront complexity of these calculations, many businesses are finding their payroll processes struggling to keep pace and are anxious about employees taking more time off.
How can businesses manage the impact of Statutory Sick Pay on payroll?
Understandably, payroll is a sensitive issue for businesses to handle.
Getting things wrong is a swift way to disenfranchise a workforce while also being subject to penalties from HMRC.
This is where having a team of professionals manage your payroll for you can help take away some of the stress.
There is a slight concern among some that employees may be more inclined towards taking sick days than they were previously.
If managed effectively, this does not necessarily have to become an issue for your business.
The Pandemic highlighted the way in which illness can rapidly spread, so having employees who are more comfortable doing what is needed to keep themselves and the rest of your team in better health should not be viewed with disdain.
Ultimately, having effective management of your payroll systems can allow you to comfortably adapt to any challenges raised by employee absences.
Our team can handle this processing for you so that you can focus on creating a work environment that people feel inspired to come back to.
Look after your team while we look after your payroll. Speak to our team today!
