PAYROLL INSIGHT
Samantha Mann MAAT MCIPPDip, CIPP senior policy and research officer, discusses the role of SSP and new ideas Flexing SSP
S tatutory sick pay (SSP) was introduced in 1983 with the intention of encouraging greater employer involvement and interaction into the management of sickness absence and of reducing the amount of work-related absence that existed at that time due to illness. Since 1983 the government has transferred, in varying but increasing ways, the obligation on the employer to fund the cost of SSP with, finally, the Department for Work and Pensions (DWP) abolishing the SSP percentage threshold scheme (PTS) at the end of the 2013–14 tax year. Introduced in 1995, the PTS allowed employers to recover any amount of SSP paid which exceeded 13% of their Class 1 National Insurance contributions (NICs) bill for the tax month. This was the final adjustment introduced by government that provided an element of financial support for employers towards the cost of SSP and was initially introduced to provide equality across all employer sizes where the employer had a large percentage of their workforce away from work and in receipt of SSP at the same time. In 2015, the associated SSP record- keeping requirements were abolished although employers were still required
to maintain records for pay as you earn (PAYE) purposes and to show they are meeting their SSP obligations should HM Revenue & Customs (HMRC) require them. SSP is now funded in full by the employer, which still comes as somewhat of a surprise to some employees. Has employee absence – or, more specifically, the resulting demands on the benefits system – reduced? It would appear not (albeit the anomaly that existed for the fortunate few in the early 1980s has long since gone) and still too many employees end up on long-term benefits due to ill health or disability. As much as I enjoy my job, and in fact enjoy work in general, during times when I am feeling unwell enough to consider not being able to work, my first thought is not “I’ll continue working because work is going to make me better”. So, when I first read the report Fitness for work: the Government response to ‘Health at work – an independent review of sickness absence’ (http://bit.ly/1tFO1nM), which was presented to Parliament by the Secretary of State for Work and Pensions early in 2013, and came across the assertion that “Keeping people in work or getting them back to work more quickly if they do go off sick is now known to be a
key factor in protecting their longer term health and wellbeing”, I thought “hmmm”. Though annual absence statistics clearly show that absence due to illness has indeed reduced, there are, however, still a significant number of employees falling out of work and in to the benefits system due to illness. Green paper At the time of writing, a consultation has closed on the DWP’s Improving lives: the work, health and disability green paper (http://bit.ly/2f5hXLb) which looks to consider solutions to address an inequality that currently exists, as employment rates amongst disabled people demonstrate that less than half (48%) of disabled people are in employment compared to 80% of the non-disabled population. Approaching the research by looking at different areas of work needed to fulfil a ten-year vision for reform, the green paper laid out the foundations for change and called for responses and views from disabled people and people with long- term conditions. (Almost one in three working-age people in the UK have a long-term health condition that risks their participation in work and around one in five of the working-age population has a mental health condition.) Responses were also encouraged from their families and carers, health and social care professionals and their representative bodies, local and national organisations,
...too many employees end up on long- term benefits due to ill health or disability
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| Professional in Payroll, Pensions and Reward | April 2017 | Issue 29
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