Sick pay isn’t working… and the ‘pingdemic’ proves it

‘Now is not the right time to introduce changes to the sick pay system’ a government paper on workplace absences declared this week. It beggars belief.

This is exactly the moment ministers need to take serious decisions on sick pay. A time when millions of people are off work, either ill with Covid-19 themselves, at home looking after children sent home from school or self-isolating to protect society, is the obvious time to act.

The ministerial announcement this week was in response to a consultation the government held two years ago, well before the pandemic even started. It has been a long wait to hear that nothing new will happen.

That is especially true because the ideas the government presented in 2019 and have now shelved were actually pretty modest. The most important was a plan to extend the right to sick pay to low-paid, part-time workers with jobs paying under £120 per week.

Furlough will comes to an end soon but it needs a worthy successor. The government should change its mind and accept the case for reforming sick payAndrew Harrop, Fabien Society general secretary

Andrew Harrop, Fabien Society general secretary

The idea was proposed by the Taylor Commission on modern working practices back in 2017. It had support from businesses and trade unions, and the government had previously sounded keen. If ministers can’t even make such a modest and consensual change to sickness payments, how will they ever go further?

The reality is that statutory sick pay needs a complete overhaul. When the pandemic descended and sickness-related absences spiked, huge numbers of people discovered there were only entitled to £95 per week in place of their usual wages. Many employers provide more sick pay out of choice. But for around one third of employees, usually in low paid jobs, the statutory minimum sick pay is all they get.

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As the pandemic got going ministers recognised that such inadequate sick pay would stop people being able to self-isolate. But instead of fixing the system they created a separate scheme of self-isolation grants which have since had plagued by bureaucracy and low take-up. Why not just make sick pay work? There are lots of options for improving the system. In June the Fabian Society published a report commissioned by the TUC which presented some of the best. The first thing to think about is making sick pay available as soon as people are off work.

At the moment employers can refuse to pay workers during their first three days of absence. That’s always been unfair for employees but it is now obvious that it poses an infection risk when it forces sick people to come to work. Ministers have temporarily suspended this three-day rule, but only during the pandemic and only for absences linked to Covid-19.

We also just need higher rates of minimum sick pay. Today the UK pays a smaller share of people’s typical earnings than any other country that has a sick pay system. The first thing to do is to increase the level of statutory sick pay. As a minimum it should be paid at the same rate as maternity pay, which is £152 per week. Or better still, both should be paid at a rate that matches the living wage.

BREAKING �ʨ: The government has just U-turned on a promise to extend sick pay to millions of low paid workers.

— Trades Union Congress (@The_TUC) July 20, 2021

Going further, statutory sick pay should be reformed to make it more like the Covid-19 furlough scheme, so it is paid as a proportion of people’s normal earnings not just a flat fixed-rate. That’s how almost all sickness payments work in the rest of Europe and it is what responsible employers do with their occupational pay schemes.

For now the furlough scheme can be used instead of sick pay for pandemic-related health absences. But because it is much more generous than normal sickness payments, government officials have been trying to keep this secret. Maybe they were scared people would get used to the idea that low paid employees should get most of their wages, even when they are off work sick?

Furlough will comes to an end soon but it needs a worthy successor. The government should change its mind and accept the case for reforming sick pay. As we recover from this terrible pandemic, we need earnings-linked sickness payments for every employee.

Andrew Harrop is the general secretary of left-wing think tank The Fabian Society

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