Sickness and absence
Occupational sick pay UK: designing a clear policy
Occupational sick pay is the extra support an employer provides through its own scheme. A good policy explains the promise precisely and shows how it works alongside Statutory Sick Pay.
- Sets the enhanced benefit
- Company policy
- Still required separately
- SSP check
- Track used and remaining allowance
- One record
Guidance for England, Scotland and Wales. Northern Ireland employment rules can differ.
How company sick pay relates to SSP
An employer can offer more than the statutory minimum. Company sick pay is also called contractual or occupational sick pay, and its terms come from the scheme or employment contract.
Be explicit about whether full or half pay includes SSP. For example, a promise of full pay inclusive of SSP normally means payroll makes up the difference, rather than paying full salary and SSP on top. The wording of the actual agreement matters.
The decisions a policy needs to answer
Define the allowance in weeks or working days and explain the measurement period. A rolling period and a fixed policy year can produce very different results after several absences. Write the rule so an employee can follow their own balance.
Describe any qualifying service, evidence requirements for the company scheme, discretion and review process. Changes to contractual benefits need careful handling; do not silently change the policy while someone is already receiving an agreed benefit.
- Who is covered, and from which date?
- How much is paid, and for how long?
- Does the company payment include SSP?
- How are previous absences counted, and who can explain a calculation?
Source: GOV.UK: Statutory Sick Pay employer guide · GOV.UK: written statements of employment particulars
Apply the scheme consistently
When enhanced pay runs out, check SSP entitlement instead of assuming that all sick pay stops. From 6 April 2026, SSP can start from the first full working day and the old lower earnings threshold no longer applies.
Keep a record of the scheme version, the allowance used and the calculation sent to payroll. Consider reasonable adjustments for disability-related absence and discuss support with the employee. A standard trigger should not replace that individual assessment.
Source: GOV.UK: when SSP is payable · GOV.UK: SSP eligibility and form SSP1 · Acas: reasonable adjustments at work
In practice
Explain a change from full pay before it happens
A company offers four working weeks at full pay, inclusive of SSP, followed by SSP where the employee remains eligible. A manager should not simply mark the fifth week as unpaid.
Before the allowance ends, payroll checks the employee's remaining statutory entitlement. The manager then explains the next payment, the relevant dates and whom to contact if the employee thinks the record is wrong.
Your next steps
- Check the exact contractual wording before promising or changing a payment.
- Choose one allowance period and record it clearly.
- Track enhanced pay and SSP eligibility as separate decisions.
- Give the employee advance notice of an expected pay change and a clear calculation.
Sources and review
Reviewed against the official guidance below on 7 September 2026. Rates and employment rules can change; use the linked guidance for a decision about an individual case.
- GOV.UK: Statutory Sick Pay employer guide
- GOV.UK: when SSP is payable
- GOV.UK: SSP eligibility and form SSP1
- GOV.UK: written statements of employment particulars
- Acas: reasonable adjustments at work
Contains public sector information licensed under the Open Government Licence v3.0. Crown copyright. This is Leavely's independently written guide.
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