How Is Statutory Sick Pay Calculated in 2026/27?

How is statutory sick pay calculated in 2026/27?

For the 2026/27 tax year, statutory sick pay is the lower of 123.25 pounds per week or 80 percent of the employee's average weekly earnings. Since 6 April 2026, under the Employment Rights Act 2025, SSP is paid from the first full day of sickness absence: the three waiting days were abolished, and the lower earnings limit was removed, so eligibility no longer depends on how much someone earns. Average weekly earnings are calculated over the eight weeks before the absence using pay liable for National Insurance. The daily rate is the weekly rate divided by the number of qualifying days in that week, which are the days the employee normally works. SSP runs for up to 28 weeks per period of sickness, absences within 56 days of each other link into one period, the employer pays it, and it is taxable like normal pay.

The 2026/27 rate and the 80 percent rule

The flat weekly rate for 2026/27 is 123.25 pounds, up from 118.75 pounds in 2025/26. The reform added a second leg to the calculation: every employee receives the lower of the flat rate or 80 percent of their average weekly earnings. For most full-time employees the flat rate is the lower number and nothing changes in practice. For low earners the 80 percent rule is what makes them eligible at all, because before April 2026 anyone below the lower earnings limit received nothing.

A worked example: someone averaging 100 pounds per week gets 80 pounds per week of SSP (80 percent of earnings, below the flat rate). Someone averaging 400 pounds per week gets the full 123.25 pounds, because the flat rate is the lower of the two.

What changed on 6 April 2026

The Employment Rights Act 2025 rewired three SSP fundamentals at once, effective 6 April 2026. Payment now starts on the first full day of sickness rather than the fourth, the lower earnings limit is gone, and the 80 percent of average weekly earnings calculation protects low earners from getting more in SSP than they normally earn.

Working out the daily rate

SSP is a weekly figure paid per qualifying day, so the daily rate is the weekly rate divided by the number of days the employee normally works in that week. For someone on a standard five-day week at the flat rate, that is 123.25 divided by 5, or 24.65 pounds per qualifying day. For a three-day week it is 41.08 pounds per day, and for someone whose SSP is 80 percent of earnings, the same division applies to their lower weekly figure.

Days an employee would not have worked anyway are not qualifying days and are not paid. That is why two employees off sick for the same calendar week can receive different totals: the calculation counts scheduled working days, not calendar days.

How long SSP lasts and how absences link

SSP runs for up to 28 weeks per period of sickness. Absences separated by 56 days or fewer link into a single period, which matters in both directions: a recurring condition keeps its day-one entitlement without restarting paperwork, but the 28-week clock also keeps running across linked absences instead of resetting.

When SSP ends or cannot be paid, the employer issues form SSP1, which the employee needs to claim Employment and Support Allowance or Universal Credit. Transitional rules protect people who were already receiving SSP before 6 April 2026 and earn between 125 and 154.05 pounds per week: they keep the flat rate for that continuous absence so the reform cannot reduce their pay mid-sickness.

Who pays SSP and how it is treated in payroll

The employer pays SSP directly through payroll, and it is taxable income subject to National Insurance like normal pay. There is no state reimbursement for standard SSP, which makes accurate sickness records and clean qualifying-day setups a payroll cost question, not just a compliance one.

Many employers pay more than the statutory minimum through occupational or company sick pay. SSP is the floor: a company scheme can top it up, but the statutory calculation above is what every eligible employee must receive at minimum.