Payroll insight
employers, charities and indeed anyone with a view on change proposed in the green paper or needed. The paper considers what further actions can be taken by employers to support employees who are disabled or with health conditions to not only get in to work but also stay in work. The requirement for a more proactive approach to be taken by employers ● What good practice is already in place to support inclusive recruitment, promote health and wellbeing, prevent ill health and support people to return to work after periods of sickness absence? ● Should statutory sick pay be reformed to encourage a phased return to work? If so, how? ● What role should the insurance sector play in supporting the recruitment and retention of disabled people and people with health conditions? ● What are the barriers and opportunities for employers of different sizes adopting insurance products for their staff? Flexible SSP Currently, SSP is paid only when an employee does no work at all and so in its current form doesn’t support, or at least not easily, a phased return to work or flexible working. A potential reform would be to allow phased returns so that where an employee would earn less than SSP in returning on reduced hours, the employer would look to top up their wages to the level of SSP or above. Two proposals were detailed in the green paper illustrated by these examples: ● An employee works 25 hours a week for £7.20 per hour or £180 per week. If they went on a period of sickness absence they will need to return to work for at least 13 hours in order to compensate for the loss of £88.45 in SSP (13 × £7.20 = £93.60). If the employer and employee came to an agreement for a partial return to work of 10 hours per week, the employer would ‘top up’ the salary to the SSP level. For example, the employer would pay £72 in wages (£7.20 x 10 hours) plus £16.45 to ‘top up’ to the SSP rate of £88.45. ● Employee would get £72 wages (40% of total, matching the time they work) plus around £53 of their SSP (60%), and it is most assuredly on the cards as government seeks to discover:
would be worth the employee’s while to return to work. From the employer’s point of view, they could either pay £88.45 for the employee to do nothing or pay a total of around £125 to have them at 40% capacity, and the knowledge that the employee will return to work completely, so there are no replacement costs. ...review the operation of the fit note and consider whether fit note certification should be extended ... This would mean that the maximum amount of SSP and/or pay spent by employers and received by employees during a period of transition back from sickness remains constant. It is clear from the two examples that there could potentially be a divide of opinion depending on whether you are the employee discussing phased return with your GP (general practitioner) and employer or the employer looking to minimise your pay bill. Views were sought on these options and to the questions: Will phased return work? Would rules be needed to make this change? How could take up be encouraged and communicated? Invest in health and well-being Several countries mandate employers to manage sickness absence proactively. Although this proposition isn’t being stated there does seem to be a very strong hint that employers will be ‘encouraged’ to play a greater role in providing for long-term absence through the take up of insurance. Both the employer and the employee can take out insurance cover to provide income protection. Policies can take several forms; life insurance, private medical insurance, critical illness cover or personal accident or sickness insurance cover with the final element being available to the employee in the form of individual income protection or to the employer in the form of group income protection. The green paper sought views as to what role the insurance industry could take
to support the recruitment and retention of disabled people and people with health conditions. Communications Whatever the responses and regardless of which proposals make it through to a white paper consultation of the future, one thing is clear and that is the need to develop good employer communications with employees who are away from work due to illness or who are at risk of being away due to illness (which essentially will include all employees). The green paper asked “What good practice is already in place to support inclusive recruitment, promote health and wellbeing, prevent ill health and support people to return to work after periods of illness?” Good communication does exist and many employers who currently struggle with this vital part in the management of sickness absence can learn from the experiences of other employers. Fit note Any phased return to work is likely to begin with a fit note completed (in all likelihood) by the GP (following discussion with the employee). Anecdotal evidence suggests that phased return recommendation or returns based on amendment by the employer is not happening as much as would be liked by government. Accordingly, the green paper announced that government also intends to review the operation of the fit note and consider whether fit note certification should be extended from doctors in primary care and other settings to other healthcare professionals. The review will also consider whether the current system meets the needs of all users in the process, GPs, employers and employees as well as benefit claimants. And, finally The green paper is just a start of what we hope will be a long-term process. If it has passed you by and you are now thinking you would like to share your views, it is not too late. The CIPP Policy team have been, and will continue to be, in discussion with DWP and HM Revenue & Customs through the Statutory Payments Consultation Group and would welcome your views to policy@cipp.org.uk . n
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Issue 29 | April 2017
| Professional in Payroll, Pensions and Reward |
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