SSP from day one – are your policies and payroll ready?

From 6 April 2026, significant changes to Statutory Sick Pay (SSP) will come into force, affecting how employers manage sickness absence, payroll processes and staff policies.

While the headline changes may appear straightforward, the practical and administrative impact for many South West businesses could be more substantial than they may be expecting, particularly for SMEs.

What is changing?

From April 2026:

• The three waiting days will be removed, meaning SSP will be payable from day one of sickness absence.
• Eligibility for SSP will no longer depend on earnings, with the lower earnings limit threshold removed.
• Employees will be entitled to the lower of 80% of their average weekly earnings or £123.25 per week.
• The maximum entitlement of 28 weeks of SSP remains unchanged.

Although other employment-related changes are also planned for April 2026, these SSP reforms are likely to be the most immediately relevant for both employers and employees.

Why this matters for employers

Historically, short-term absences of one to three days have often been treated informally by employers, particularly in smaller businesses. However, from April 2026, that approach will no longer be workable.

SSP being payable from day one means all sickness absences must be recorded accurately, including short-term absences, and payroll teams (whether in-house or outsourced) will need complete and timely absence data.

The removal of waiting days also changes how the 28-week SSP limit operates. While the overall cap remains the same, SSP can now be spread more easily across multiple periods of absence within a year, making monitoring even more important.

The bottom line is employers face an increased administrative burden, particularly where sickness tracking has previously been light-touch.

Reviewing payroll and company sick pay policies

Many businesses operate enhanced company sick pay schemes, for example full pay for a set period followed by half pay, before falling back on SSP.

Some policies are explicitly linked to SSP starting on the fourth consecutive day of absence, so from April 2026, employers will need to consider:

• Whether enhanced sick pay should now apply from day one.
• How SSP interacts with full pay and half pay periods.
• Whether policy wording still reflects how pay is actually applied in practice.

We expect the financial impact of the changes will vary considerably depending on business size, sector, nature of job roles and the frequency of sickness absence.

Sectors with higher exposure to illness – such as care, health services, education and customer-facing environments – may see a greater impact than businesses with lower anticipated absence levels.

And of course, that is without factoring in the administrative costs and compliance risk associated with managing the new system.

At present, many SMEs are aware to varying degrees of the changes but not necessarily the full implications and are not actively preparing for them yet.

However, we would advise that now is the time to start your preparation  so you are ready on day one for the changes and to avoid any confusion or disruption with your business. My three-point checklist would include:

• Review your sickness and absence policies now
• Ensure that your payroll and HR processes are aligned
• Make sure managers understand the importance of accurate absence reporting going forward

How Westcotts can help

Westcotts works with businesses across the South West to help them understand regulatory changes, what they mean in practice and how best to manage and prepare for them.

Our payroll team led by Liz Marker and Jake Elms support many businesses in efficiently managing their payroll so whether you are already working with us, considering switching your payroll provider or just need advice, we’re always on hand to help. Reach out to the team here.