Sick pay - how much do you get?

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Sick pay can be a confusing notion for employers and employees alike. Hannah Uttley explores staff coverage.

A staggering half of UK workers incorrectly assumed their employers would foot the bill for long-term sick leave, according to a poll carried out earlier this year.

The survey conducted by think-tank Demos found twice as many employees insure their mobile phone or pet, rather than their wages.

Sick pay, both short-term and long-term, is widely misunderstood by employees and even by employers themselves.

Though companies are legally required to pay just £85.70 of Statutory Sick Pay (SSP) a week for a maximum of six months, half (51%) of respondents in Demos’ findings thought that their employers would pay full wages over this period.

While companies are obliged to pay out SSP to all employees who pay national insurance contributions, companies can also offer a higher pay out and amend certain details, such as offering pay from day one of illness under their own separate occupational sick pay schemes.

And although 86% of employers provide occupational sick pay to all employees, according to the CIPD 2010 Absence Management Survey, these schemes just covered the first three days of absence in nine out of 10 (89%) cases.
Short-termist view

Lee Thurston, head of practice at JLT Benefits Solutions, said a short-termist view among many employees has led to a certain naivety of the benefits that could be reaped from insuring salary.

“I think group income protection as a benefit has suffered because people just think about immediacy. People also think, “Well, I’m never going to be off for that period of time.” But actually the statistics show that somebody is more likely to be off with a condition than to die – or than their pet is to fall ill or they are to lose their mobile phone.”

Tighter rules about disability benefits have also made these increasingly difficult for individuals to claim. As the government has handed over the responsibility of work capability assessments from GPs to the private firm Atos Healthcare, the focus is now on whether individuals are fit for work and ill enough to be off work.

Echoing the findings revealed in Demos’ survey, Ronjit Bose, employee benefits commercial director at Jelf, says that the provision of sick pay is often presumed by employees, with the line between SSP and occupational pay often blurred.

“Few employees will look into what level of company-paid sick pay is available until they’re ill, and then the link between what the company will provide versus what the state will provide is probably unclear for most employees, so they won’t necessarily appreciate how much their sick pay may change as it transitions from employer to state if they are on long-term sick leave,” said Bose.

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