It set out a holistic set of potentially far reaching legislative and good practice measures, including:

• Reforming Statutory Sick Pay (SSP) so that it’s better enforced, more flexible and covers the lowest paid 
• Introducing a new statutory right for employees (who are not covered under the duty to make reasonable adjustments under the Equality Act) to request work(place) modification(s) on health grounds
• Improving access to occupational health services with additional support for small employers 
• best practice advice and support for employers on managing health and disability in the workplace.

Two years later, the government has published its long-awaited response, which takes forward some  of the proposals, but none of the legislative ones. We examine the key developments and what they could mean for people’s health at work.

No action on SSP

The biggest surprise – and disappointment – is that the government has decided ‘that now is not the right time to introduce changes to the sick pay system’. Its original consultation announced its intention to ‘reform SSP so that it is available to all employees who need it, is more flexible in supporting employees and is underpinned by a suitable enforcement framework.’  The proposed changes included:

• amending the rules of SSP to allow for phased returns to work following sickness absence
• widening eligibility for SSP to extend protection to those on the lowest incomes including the extension of SSP to include those earning below the Lower Earnings Limit (LEL): following the recommendation in Taylor review of modern working practices, the Government said in its consultation that ‘it believes there is a case to accept this recommendation’
• an SSP rebate for SMEs that demonstrate best practice in supporting employees on sickness absence
• strengthening compliance and enforcement of SSP to ensure employees are paid what they are due.

With the possible exception of the latter, none of these trailed reforms will now move forward. 

The CIPD response to the consultation highlighted strong support for the government’s intention to reform SSP to make it more flexible so that it could be paid on a part-time basis; in our survey of 1,051 HR professionals, three in four HR professionals (75%) supported (the change. The Government’s own response highlights the benefits of phased returns, shown to be ‘particularly effective in supporting individuals with musculoskeletal and mental health conditions’, and that respondents were ‘broadly supportive’ of phased returns to work. And so it’s perplexing that there is no indication that SSP will be reformed to enable a more responsive and flexible system.

SSP is failing to protect the most vulnerable

At £96.35 per week the SSP rate is the second lowest sickness benefit replacement benefit level compared to other European states pre-pandemic. Neither is it linked to earnings level. 

Since the government released its consultation, the world has been hit with a devastating global pandemic, which has only served to emphasise the urgency for reforms to improve the financial safety net for people unable to work because of ill health. The CIPD’s submission to the October 2020 Comprehensive Spending Review called for urgent regulatory reform to SSP as COVID-19 continued to highlight the inadequacy of the current system in protecting the lowest-paid and most vulnerable. Six million UK workers don’t qualify for SSP (around 4.75 million because they’re self-employed and 1.7 million because they don’t meet the earnings threshold for SSP). We urged the government to extend SSP to include employees earning below the lower earnings limit (LEL) and raise the level of SSP to be significantly closer to the equivalent of someone earning the National Living Wage (then £327 for a 37.5 hour working week).

The government’s response reports that three-quarters (75%) of respondents agreed SSP should be extended to employees earning below the LEL and that employers ‘would be better incentivised to reduce sickness absence for all of their employees’. Therefore it’s hard to understand why there will be no reforms in this area.

We remain concerned that many individuals with a health condition or disability requiring them to take a longer period off work face financial hardship because they don’t qualify for SSP and, if they do, that the current flat rate of SSP is so much lower than many people’s earnings. CIPD research in 2020 showed that a quarter of workers (23%) who would receive either SSP or no pay in the event of sickness absence due to Coronavirus said that they would struggle to pay bills or buy food within just one week, rising to 33% for a two-week period of sickness absence. 

The financial inadequacy of SSP and the lack of eligibility for many could encourage some workers to come back to work much earlier than they should do healthwise, possibly making their condition worse. The shortfall also affects people’s ability to self-isolate in the face of COVID-19. March 2021 ONS data from the COVID Test and Trace Cases Insights Survey showed that the majority of people did report fully isolating, although a significant proportion suffered a financial hit, including 14% who were not paid at all during the isolation period. 

A number of organisations across the employment arena, including the CIPD, the CBI, the TUC and the Resolution Foundation have called for urgent reform in these areas and we will continue to lobby for these changes. 

No new right to request work(place) modifications on health grounds

The CIPD’s submission was supportive of this change - 70% of HR professionals we surveyed agreed that a new right to request work(place) modifications on health grounds would be an effective way to help employees to receive adjustments to help them stay in work (just 9% disagreed). 

Despite this strong support from our membership, as well as Policy Forum members in a roundtable, our response did highlight some complexities about this proposed reform. For example, it was felt the new right may inadvertently create a confusing legislative framework (along with right to request flexible working) for organisations and managers to navigate and implement (particularly in smaller firms with no HR expertise). An unintended impact could be the creation of a ‘two-tier’ approach to disability and health, with the existing right for reasonable adjustments offering a higher standard of protection for those with disabilities compared with the proposed new right relating to health conditions. 

Despite these challenges, a new right to request could have been far-reaching, empowering those employees not covered by the reasonable adjustments duty to seek the support they need from their employer. We still welcome the Government’s intention to ‘instead take steps to increase awareness and understanding of existing workplace rights and responsibilities, in particular the duty to make reasonable adjustments under the Equality Act 2010.’

Employers have a responsibility for people’s health and wellbeing

The government highlights the range of support that it has put in place to support workers in response to COVID-19, including the Coronavirus Job Retention Scheme, temporary changes to SSP, and the COVID-19 mental health and wellbeing recovery action plan. This is undoubtedly true, but we still need more permanent and far-reaching changes to protect workers’ incomes when unable to work through illness or injury, as well as encourage more effective rehabilitation and return-to-work. The Government’s response does signal its intention to take forward other welcome reforms to support the latter aim, including:

• reform of the occupational health (OH) market and better access to OH by SMEs 
• the strengthening of non-statutory ‘principles based’ guidance by HSE to encourage early and supportive action from employers to aid the return-to-work process
• the development of a national information and advice service for employers
• a reinstatement of its aim to set up a Single Enforcement Body with responsibility for enforcement of SSP
• reform of the Fit Note including a removal of the requirement for it to be signed in ink. 

There is no serious consideration of the need to reform SSP, however - a missed opportunity which we will explore in more depth as part of our public policy work going forward.

Finally, a core theme of the response is the government’s role in encouraging employers to take greater responsibility for the health and wellbeing of their employees, a position we fully endorse. We therefore look forward to continuing our collaboration with government and stakeholders across the employment arena to take forward this vital work and health agenda. As the voice of a worldwide community of over 155,000 HR professionals working in the fields of people management and development, our members play a pivotal role in helping to achieve a much wider and more sustainable integration of health and well-being practices at work.