Act Now: Statutory Sick Pay Reform Is Imminent

With the Employment Rights Bill almost certain to receive Royal Assent in early November and the first provisions due to take effect just two months later, employers must now move beyond awareness and begin practical preparation. Statutory sick pay reform will not be something that can be left until the last minute. To protect both compliance and business continuity, it is essential to act now.

Review and Update Policies and Procedures

The first step is to review your policies and procedures. If your employee handbook or absence policy refers to eligibility criteria based on the lower earnings limit or includes the existing three-day waiting period, this will no longer be accurate once the new rules come into force. Outdated policies create confusion, increase the risk of disputes, and leave managers unsure how to apply the law.

Employers should ensure that documentation is refreshed to reflect the new universal entitlement and day-one access, and that updated versions are shared with staff in advance of implementation.

Communicate Clearly with Employees

Communication with employees will be just as important as the policy wording itself. For many staff, particularly those who have never previously qualified for statutory sick pay, the reform will represent a new benefit that must be carefully explained.

Employees need to understand not only their entitlement but also their responsibilities—such as notifying their manager promptly if they are unwell and providing the necessary evidence of incapacity when required. If this is not communicated clearly, the risk of misunderstanding or inconsistent practice will increase.

A proactive communication campaign, whether through team briefings, manager updates or written guidance, will help create clarity from the outset.

Ensure Systems and Processes Are Ready

Attention must also be paid to the systems and processes that support sick pay. Payroll software must be updated to reflect the removal of the waiting period and the broader pool of eligible employees. Absence reporting systems should be reviewed to ensure that information flows correctly from managers to payroll and that records are accurate.

Employers may wish to run test scenarios before the new rules take effect, to confirm that payments are triggered correctly from day one and that records align with statutory requirements.

Prioritise Manager Training

Training for managers should be prioritised. Many of the practical challenges of managing absence arise not from the rules themselves but from how they are applied at line management level.

Managers must know what to do when an employee phones in sick, how to respond when an absence extends beyond a few days, and how to carry out effective return-to-work meetings. Training should also cover how to balance sensitivity with accountability—ensuring that employees feel supported when genuinely unwell, but that patterns of repeated short-term absence are spotted and addressed early.

Plan for the Financial Impact

Financial planning should not be overlooked. Even though the statutory rate of sick pay remains modest, the increased eligibility will almost certainly lead to more payments being made.

For businesses with high numbers of part-time or casual workers, this could be a noticeable cost increase. Employers should analyse sickness absence data from recent years and model how the new rules might change their financial exposure. Considering how to cover shifts or redistribute work during absences will help minimise disruption, and small businesses in particular may want to explore whether employment insurance products could provide an additional safety net.

View Reform as an Opportunity

Finally, employers should treat this reform as an opportunity rather than a purely administrative burden. Extending statutory sick pay and removing waiting days is designed to encourage staff to stay at home when unwell, reducing the risk of presenteeism and workplace contagion.

By positioning your response as part of a broader wellbeing strategy—emphasising that the business values health and recognises the importance of recovery—you can build trust and demonstrate that compliance goes hand in hand with care for your workforce.

Employers who frame this change positively are likely to see improved employee engagement, greater transparency around health issues, and ultimately a more resilient business.

Prepare Early to Stay Ahead

In short, businesses that act now—by updating policies, communicating clearly, testing systems, training managers, and preparing financially—will be ready to implement the new rules smoothly. Waiting until the law is in force will only invite confusion and disruption.

By being proactive, employers not only ensure compliance but also use the opportunity to strengthen the relationship between business and workforce at a time when trust and stability are more important than ever.

Consider the Wider Legal Landscape

It is also important to recognise that these changes will not happen in isolation. Statutory sick pay reform may be the first significant shift that employers feel, but it sits within a broader government plan that will roll out further changes to trade union rights, employment tribunal timelines, and other key areas of employment law in the months that follow.

The increased onus of SSP, and the costs associated with it, will also coincide with the upcoming National Minimum Wage increase. For many businesses, this convergence of reforms and rising wage costs could create a real financial pinch point.

The organisations that prepare early, plan carefully, and view sick pay reform as part of a bigger picture will be the ones best placed to manage the dual pressures of compliance and cost while maintaining stability for their workforce.

Looking Ahead: Culture and Cost Shift in 2026

The Employment Rights Bill is now on the brink of becoming law, and while its reforms will be phased in, the first major change employers will feel is statutory sick pay. From early 2026, SSP will be payable from day one of absence and available to all employees, regardless of their earnings.

This represents a real shift in both culture and cost for employers. What’s important to note is that these changes will coincide with the next increase in the National Minimum Wage, creating a compounded impact on wage bills and absence management.

At HR:4UK, we’re already advising clients to prepare now—updating policies, training managers, and estimating future costs—so they’re ready to handle both challenges together rather than being caught off guard when the reforms land.