Government to scrap Statutory Sick Pay Percentage Threshold scheme

The government announced in the 2013 Budget that it would be scrapping the Statutory Sick Pay Percentage Threshold scheme from April 2014 and reinvesting the money saved into funding a new Health and Work Service, which is due to launch in pilot form this autumn and then as a national network from April 2015.

The percentage threshold scheme compensates employers that are experiencing higher-than-average sickness absence by allowing them to recover some of the statutory sick pay (SSP) paid to their employees, if the total SSP paid in a tax month is greater than a set percentage of their gross Class 1 NICs (employers’ and employees’) liability for that month.

However, although this benefit is being wound up, there will be a transitionary period until April 2016 in which employers will be allowed to recover SSP paid for sickness absences occurring before the end of April 2014.

Employers will also need to be aware that while the associated SSP record-keeping requirements will also be abolished from April 2014, employers will still be required to maintain such records for PAYE purposes and to demonstrate they are meeting their SSP obligations.

More details on the new Health and Work Service can be found at: https://www.gov.uk/government/policies/helping-people-to-find-and-stay-in-work/supporting-pages/co-ordinating-the-health-work-and-wellbeing-initiative