What you need to do when paying sick pay to an employee who’s pregnant, in legal custody, in a trade dispute, has overpaid or underpaid, or earns below the Lower Earnings Limit.
Your employee earns less than the Lower Earnings Limit
Your employee may not qualify because their Average Weekly Earnings (AWE) are less than the Lower Earnings Limit. Check whether they received any benefits or expenses within the relevant period. Review them to see if they were subject to a PAYE Settlement Agreement and Class 1B National Insurance contributions (NICs) and would otherwise have attracted Class 1 NICs liability.
If so, you must recalculate their AWE to include these expenses and/or benefits, on which Class 1B NICs were paid, to see if they now qualify.
Your employee has been overpaid or underpaid
If there are over or underpaid earnings affecting the AWE which disadvantages either you or the employee, check if there is documentary evidence of an agreement as to the amount that should have been paid. If there is, use the agreed earnings to calculate the AWE and if not, use the actual earnings.
Your employee is in legal custody
If an employee is taken into legal custody during a current Period of Incapacity for Work (PIW) entitlement to SSP will end on the day before they were detained. No new PIWs can start until the day following release.
Any full or part days an employee is detained in custody don’t count towards qualifying days, waiting days or linking.
A new PIW (regardless of whether it’s the original illness or a new illness) formed after release will link if there is 56 days or less between them. Please read Statutory Sick Pay (SSP): employer guide for further information.
Your employee is involved in a trade dispute with you
Your employee can’t get SSP if they’re off work because of a trade dispute on the first day of the PIW. To be entitled to SSP they must have no direct involvement in the dispute. And they must not have taken part in it at any time up to and including the first day of the PIW.
Linked PIWs count as 1 – it is the situation at the start of the first PIW (for example involved in a trade dispute with you) that counts when deciding whether you can pay SSP. So if your employee has a linked PIW, SSP won’t be due, as they were involved in a trade on the first day of the previous PIW.
If they are off sick when the trade dispute starts, they will continue to be entitled to SSP only if they take no active part in the dispute.
Your employee is pregnant
Women who are entitled to Statutory Maternity Pay (SMP) or Maternity Allowance (MA) are not entitled to SSP during their Maternity Pay Period (MPP) or Maternity Allowance Period (MAP). The MPP or MAP is a period of 39 weeks during which SMP or MA is payable.
If your employee is not entitled to either SMP or MA and is not already receiving SSP, she can’t get SSP for 18 weeks starting with the earlier of the beginning of the week:
- in which her baby is born
- she is first off sick, either wholly or partly because of her pregnancy, if this is on or after the start of the fourth week before her baby is due
If your employee is not entitled to SMP or MA and is receiving SSP, her entitlement will end on the earlier of the:
- date on which her baby is born
- day she is first off sick, either wholly or partly because of her pregnancy, if this is on or after the fourth week before her baby is due
Where a PIW doesn’t start until after the end of the disqualifying period, SSP must be considered under the normal rules for that PIW.
Your employee has a linking letter
You must ask any new employee who goes sick within the first 12 weeks after they start or return to work for you, if they were given one of these forms by the Department for Work and Pensions. If so, your employee may be able to return to social security benefit payments and therefore is not entitled to SSP.
You must send an employee form SSP1 within 7 days of them going off sick if any of the above circumstances apply and your employee doesn’t quality for SSP.
Published: 14 March 2014
Updated: 19 January 2017
- The section 'Your employee has been overpaid or underpaid' has been updated.
- The section Your employee is in legal custody has been updated.
- The 'Statutory Sick Pay: employee circumstances that affect payment' has been updated to include a link to the form SSP1.
- The section 'Your employee is in legal custody' has been updated.
- First published.
From: HM Revenue & Customs
Related guides: Statutory Sick Pay: manually calculate your employee’s payments