Coronavirus: Employment rights and sick pay (2020)

Daniel Ferguson

This is a fast-moving issue and should be read as correct at the date of publication (17.03.20).

The rise in the number of cases of Covid-19 (coronavirus) in the UK has led to concerns about the effect on the workforce. According to Government estimates, in a worst-case scenario, up to one-fifth of the workforce could be absent from work.

There have been questions about statutory sick pay (SSP) during periods of ‘self-isolation’. In particular, there are concerns over what will happen to the estimated two million low-paid and casual workers who do not qualify for SSP.

The Government has committed to introducing emergency legislation on sick pay.

At the time of writing there have been 1,543 confirmed cases in the UK, and 55 people have died.

This Insight provides an overview of a number of employment-related issues and Government action to date.

Who is entitled to sick pay?

As with any other illness, a person who is off sick with coronavirus will be entitled to SSP under the Social Security Contributions and Benefits Act 1992, provided they meet the qualifying conditions.

SSP is the minimum level of pay employees are entitled to when off work sick. Many will have a right to enhanced sick pay under their employment contract.

Only ‘qualifying employees’ are entitled to SSP. Social security legislation uses a slightly broader definition of ‘employee’ which includes those who pay Class 1 National Insurance Contributions. Agency workers are also deemed to be employees.

To qualify, employee’s average weekly earnings must be at least £118. A 2019 Government consultation said that up to two million workers did not meet this earnings threshold. ‘Gig economy’ workers, whose contracts say they are self-employed, may also not qualify, although some gig economy firms are reportedly considering paying workers who have to self-isolate.

SSP is payable for a ‘period of incapacity for work’ (PIW). This is any period of four or more days where an employee is incapable, or deemed to be incapable, of working due to illness.

SSP is currently paid from the fourth ‘qualifying day’ within the PIW. Employers and employees will usually agree which days are qualifying days. These are typically the days the employee is contracted to work. SSP is paid at a rate of £94.25 per week.

Example
An employee works full-time, Monday to Friday. They fall ill on Sunday and are sick until the following Sunday. There is a PIW (eight days of consecutive illness). The first three ‘qualifying days’ are discounted (Monday to Wednesday). The employee is paid SSP for the remaining two qualifying days in that PIW (Thursday and Friday). They will receive £37.70 (94.25 × 2/5 = 37.70).

How does someone ‘prove’ they are sick?

If an employee is sick for more than seven days, their employer can ask for evidence that they are sick. This usually takes the form of a fit note. Employees may face challenges obtaining a fit note because those with coronavirus symptoms are currently advised to self-isolate for 14 days and not to go to their GP.

The Trades Union Congress (TUC), among others, have called on the Government to reform SSP so that it’s available to all workers regardless of earnings and payable from the first day of sickness. A number of writers have expressed concern that workers could be incentivised to continue working despite feeling ill.

What if someone can’t go to work because they’ve been advised to self-isolate?

The Government currently advises that anyone who shows symptoms of coronavirus infection, however mild, should self-isolate for seven days. In addition, it advises that whole households should self-isolate for 14 days if one member has been infected.

On 16 March, the Prime Minister also announced that those with serious health conditions will soon be advised to “largely shield [themselves] from social contact for around 12 weeks.”

Initially, there was some debate over whether those without symptoms who are advised to self-isolate would be eligible for SSP. On 12 March 2020, the Government made the Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020. The Regulations now make clear that qualifying employees who isolate themselves on the basis of advice published by Public Health England (or the devolved health authorities) will be entitled to SSP.

The regulations only apply if a person is unable to work because of self-isolation. An employee who works from home should be entitled to be paid their wages.

Where workers are instructed to stay at home by their employer, it is likely they would be entitled to their wages, particularly if they are instructed to work while at home.

What if someone can’t go to work for other reasons?

Workers with caring responsibilities, or those who are stuck abroad, or worried about coming into public places, may also be unable or unwilling to go to work.

Whether workers have a right to be paid will depend on the terms of their contract. There is an implied term (unwritten) in all employment contracts that workers must obey reasonable instructions from their employer.

Guidance produced by the Advisory, Conciliation and Arbitration Service (Acas) advises employers to listen to the concerns of their staff. However, Acas also notes that workers who refuse to follow instructions could still face disciplinary action.

Workers who do not wish to come into work may be able to take annual leave, although employers are entitled to notice.

If an employee has urgent caring responsibilities, such as if there is a school closure, they may be able to take a ‘reasonable’ amount of time off for dependents. Only employees are eligible and the time off does not have to be paid.

What if employers tell staff to work from home?

Employers have a duty to secure the health and safety of the workplace and their workers. As such, employers may feel it necessary to instruct their workers to work from home.

As noted above, there is an implied duty that workers must obey reasonable instructions from their employer. Whether employers can reasonably instruct their workers to work from home will depend on the circumstances.

What if employers close the workplace?

In extreme cases employers may decide to close the workplace. In such circumstances, workers should be entitled to be paid, whether or not they are told to work from home.

This is unless the employer has a right under contract to lay off workers without pay.

Those who are laid off without pay may be able to claim statutory guaranteed pay. This is only available to employees and is paid at a rate £29 per day for up to only five days.

What has the Government done so far?

The Government has published guidance for employers on dealing with coronavirus. It does not cover SSP in detail, although it recommends that employers relax their rules around providing evidence of illness.

On 4 March, the Prime Minister announced that the Government would introduce legislation to make SSP payable from day one of sickness. The legislation, which will be an emergency Bill introduced by the Department for Health, has not yet been published.

It is unclear whether the Government is planning broader reforms of SSP. In the Chamber on 9 March, Work and Pensions Secretary Dr Thérèse Coffey said that no worker should be penalised for self-isolating.

When asked about the £118 earnings threshold, she said the Government would: “bring forward the necessary legislation or other changes.” Meanwhile, Health Secretary Matt Hancock said the Government would “bring forward a solution,” to address the fact that self-employed people are not eligible for SSP.

The TUC criticised the Government’s suggestion that those who are not eligible for SSP should claim Universal Credit or Employment Support Allowance.

*This article was updated on 17.03.20 to reflect the Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020. An earlier version highlighted that it was unclear whether those who self-isolated were legally entitled to SSP. It has also been update to clarify that to qualify for SSP, an employee’s average weekly earnings must be at least £118.