Statutory Sick Pay Rebate – make your claim by 24th March 2022
The Statutory Sick Pay Rebate scheme offers employers an opportunity to reclaim sick pay paid to employees between 21st December 2021 and 17th March 2022 if their employees were off sick due to COVID.
To be eligible you must:
- employ fewer than 250 people,
- have paid PAYE before 30th November 2021,
- employ the individual as a worker, though they may be on a temporary, fixed term, flexible or other kind of employment contract,
- have paid the employee before 21st December 2021,
- they must earn more than £120 per week,
- they must be self isolating or sick for four or more consecutive days,
- they must be absent as a result of COVID – either having symptoms, self isolating because they live with someone with symptoms, are self isolating because they have been notified of contact by the NHS app, or are self isolating in preparation for surgery
How to claim:
- the number of employees you are claiming for,
- start and end dates of your claim period,
- the total amount of sick pay you’re claiming back,
- your Government Gateway user ID and password that you got when you registered for PAYE Online,
- your employer PAYE reference number,
- a contact name and phone number,
- your UK bank or building society account details including,
a. bank or building society account number (and roll number if it has one);
b. sort code;
c. name on the account;
d. your address linked to your bank or building society account.
What you can claim:
You can only claim £96.85 per week per employee though you may claim for multiple employees.
You can only claim up to two weeks per employee who was absent between 21st December 2021 and 17th March 2022.
Statutory Sick Pay Rebate, what it is, how you get it, and why it isn’t enough.
Since the start of the coronavirus (COVID-19) pandemic, many entrepreneurs in small businesses have struggled to maintain their work flow amidst staff sickness which comes thick and fast. The terrible combination of poor work capacity, decreasing sales, and huge hits to international supply chains has been devastating for small and medium sized enterprises (SMEs).
Throughout this period, the government has offered SMEs various levels and means of support. The huge staff furlough scheme was a massive source of relief for many who couldn’t operate at all and government grants to select businesses seem to have (mass inflation aside) more or less kept the economy afloat until now.
The Statutory Sick Pay Rebate (SSPR) scheme in combination with limited grants for hospitality, is the government’s latest attempt to support businesses throughout this period. Broadly the aim of the scheme is to allow SMEs to claim back Statutory Sick Pay (SSP) paid to employees from 21st December 2021 onwards, a reiteration of the earlier scheme which ended on 30 September 2021 (claims ending 31st December 2021). However, the scheme’s incredibly limited application, miniscule payouts for both workers and SMEs, and brief shelf life make it an almost laughable attempt to support SMEs and shows the government’s failure to recognise the huge role SMEs play in the modern economy.
You can only claim SSPR when you have paid an employee SSP. To see whether your employees are eligible to receive SSP follow the link below.
If you would like more information about whether or not your employees are eligible for SSPR please check here:
If you would like more information about whether or not your company is eligible for SSPR please check here:
The scheme will end on 17th March 2022, and employers have until 24th March 2022 to make their claim.
Does this scheme offer adequate protection for SMEs?
It is probably obvious to anyone who has heard about this scheme that the poultry £96.35 per week is a fairly pathetic sum being offered. Not only is this tiny to employers, but considering that SSP must be paid subject to PAYE, National Insurance (NI), and pension contributions, the actual value of that amount to an employee is truly woeful.
Given the minimal requirements for proof from employees of actual illness (NHS isolation notes being ridiculously easy to access without even needing to prove a positive test) it has been made simple to recover SSP for employers who are facing increased staff sickness from COVID-19 in the new year period. Certainly, it is clear, that the levels of staff sickness have been historically high – in January 2022 the guardian reported the highest level of staff sickness in the NHS since the vaccine rollout – and that the impact on SMEs has been heavy. If SMEs are paying staff only SSP when they face sickness generally, then the SSPR scheme will bring some relief to them.
That said, SSPR cannot account for the true impact of no-notice absence on SMEs. This is particularly true for larger SMEs, for example:
If I have 250 employees, and 125 of them are off for the recommended 14 day isolation period due to COVID-19 falling neatly within the designated 21st December 2021 to 17th March 2022 dates, and I pay all of them SSP (£96.35) for both weeks, the total cost (and therefore my SSPR) is £12,043.75. However, given that my usual cost for these staff (assuming these staff work on the so called “national living wage” (NLW) of £8.91 per hour for 40 hours per week and assuming they are all over 23) would be £89,100. Being a sensible employer I get at least £90,000 of work out of those employees when on site so even if I am able to claim back the £12,043.75 the actual cost to my company of the absenteeism is about £80,000, not accounting for the HR costs of managing the SSPR for so many employees, a cost any SME is likely to wince at.
Additionally, any SME which offers their employees more than the SSP £96.35 per week i.e. full or slightly reduced wages, will feel an even heavier impact when they are punished for daring to care for their workers. To understand the scale of this problem, in 2010 just 6.9% of businesses in the UK did not pay above SSP when staff were ill, with 61.7% of businesses paying staff their full wage entitlement when ill. For that 61.7% the £96.35 payment will not cover a third of the cost of payroll, even on the assumption that these staff members are on NLW. For Living Wage employers who pay £9.90 per hour across the UK or £11.05 in London, a value that has been calculated by independent sources to be the minimum cost of living in the UK on a 40 hour contract, the hit will be even harder.
This is not to mention that many employees are not “unable to work for the full four consecutive days” which is required to enable them to qualify for SSP. Many do what they can from home whilst isolating or recovering. Whilst this means that companies can generate some of the revenue otherwise lost to absenteeism, they completely lose out on any claim for SSPR.
It seems then that the government is intent on incentivising companies to squeeze their employees, encouraging stingy sickness policies which meet the companies minimum obligations. This is by no means something we at Enterprise Starter would ever want to encourage and I will, therefore, briefly make the case for paying employees at least the NLW when absent as a result of sickness.
To put this in perspective for those who have never lived on the edge of poverty, NLW is £8.91 for employees over 23 whilst national minimum wage, (NMW) is £8.36 for those under 21. Assuming that employees work an average of 40 hours a week (which is totally unrealistic for many employees subject to disability, care obligations, or who work tenuous, temporary, or zero hour contracts) then NLW will earn £356.40 per week and NMW will earn £334.30 per week.The difference between this and SSP is £260.05 per week for NLW, or £237.95 for NMW, both of whom are already living on what the government has cynically decided is the minimum acceptable amount to live on. Then there’s the deductions! PAYE, NI, and pension contributions.
Simultaneously, inflation is up nearly 5% in the past 12 months with housing, household services, and transport (the most essential items for low income workers) being the worst hit areas. The figure is lowered by decreases to the price of hotels and restaurants (luxuries for those not already struggling) creating an actual increase to the cost of living calculated to be about £1,200 per year . Assuming NLW doesn’t fall ill and get paid SSP or have any other crisis which damages their income they usually earn £18,532.80 per year. So that’s roughly a 15.4% drop in the budget of households which were already pushed to the brink at a time when food banks are running empty. That’s before companies start tightening their belts to account for decreased government support and push that squeeze on to their workers.
Just look at the average rent cost where we are, in Islington, which currently sits at £629 per week, twice what a person could ever pay on NLW (assuming they put their entire income into putting a roof over their head) before being put on SSP, and over six times as much as they would earn on SSP. Even expanding out of our local community to the wider UK, the average weekly cost for private renters is £200, and for social renters £105, so even social renters in UK average accommodation couldn’t cover their rent if they put their entire SSP payment towards rent before deductions. No wonder we now live in a country in which we see regular news articles about people starving or freezing. Incentivising struggling employers to pay no more than SSP is therefore not only negligent, it is recklessly irresponsible and fundamentally dangerous. Human dignity aside, no SME is going to flourish when its workers can’t sleep because their homes are cold, come into work hungry because they can’t afford breakfast, or are late because they can’t afford the train. This goes double for employees coming into work sick because they can’t afford to stay home, and infecting the rest of the staff because they have no other choice.
The minimal impact on the government of properly protecting both SMEs and employees can be seen by the huge and widespread general success of the Coronavirus Job Retention Scheme (furlough). Whilst the UK government claims that there is no “infinite money tree”, the vast sums produced, even at the beginning of the pandemic when the economy did not have the opportunity to brace for changing conditions, demonstrate that when they need to produce wealth, the government is more than able to do so. Even if you are of the opinion that the government could not continue to support schemes on the scale of furlough, the UK government used to cover all SSP payments for businesses up until 6 April 2014. It seems outrageous for them to expect any credit for reemitting that minimal standard for a tiny three-month period when vulnerable people face a cost of living crisis which will potentially reach the scale of the 2008 financial crash or worse.
If you are a director or other member of an SME which is struggling from high levels of staff sickness, and looking for support in understanding employment law and what government support may be available, you can contact us at Enterprise Starter.
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