31 January 2025
Employees who have a zero-hour contract are still entitled to the same Statutory Sick Pay (SSP) payments as other full time and part time employees, so long as they meet the qualifying conditions.
Period of Incapacity for Work (PIW)
Firstly, they need to have ‘an employment contract’ and they must have been sick for 4 or more calendar days, this includes non-working days, to create a ‘period of incapacity for work’ (PIW). They also must earn an average of at least £123 per week (LEL – lower earnings level), this will increase to £125 from April 2025 and they also need to give notice and proof of illness to their employer.
SSP is a Day One Right
Remember that SSP is a day one right of employment and is payable so long as the employee has carried out some work under their contract. Also, an employer should always calculate the employees’ average weekly earnings (AWE) in the relevant period (RP) to ensure they meet the LEL.
How to Establish the Relevant Period (RP)
To establish their RP, you must identify,
(1) the date of the employees last normal payday before the start of the PIW and
(2) the date of the last payday that fell at least eight weeks before the date in (1).
This includes all earnings that are liable to class 1 NICs.
SSP Not Payable for First 3 Days of Sickness (Waiting Days)
SSP is not payable for the first three qualifying days of sickness, as these are waiting days (WDs) but is payable from day four. This will mean that the weekly rate is prorated to a daily rate. The daily rate of SSP will be dependent on the number of qualifying days (QDs) per week.
SSP Only Payable on Qualifying Days (QDs)
QDs are the only days for which SSP can be paid, these must be agreed by both the employee and employer, and they are usually the days of the week on which an employee is ‘required to work’ or be available for work or normally work according to their contract of employment. Bank holidays do not interrupt the normal pattern of QDs and there must always be at least one QD each week. If the employer and employee cannot agree the QDs, legislation and regulations provide for the QDs to be one of the following:
- the days on which the employer and employee agree that the employee is/was required to work under the contract,
- or a Wednesday if there is/was no specified day of work,
- or every day of the week except those on which they agree that none of the workforce were required to work
For example, if the employer was to decide that there was 7 QDs, because employee could potentially work Monday to Sunday as a casual or zero hour employee, then the employer you would divide the weekly SSP (currently £116.75) rate by 7 and pay the daily rate of £16.68 for each QD day the employee was sick, after the three waiting days had been served.
Zero Hour Contract Staff on Sick Leave Still Accrue Annual Leave
A consideration to finish off - when an employee who is on a casual or zero hours contract is off sick, or on family leave they will still accrue annual leave. For an employee receiving rolled up holiday pay, their rolled-up holiday pay would be calculated according to average amount of the worker’s total earnings in each pay period during the 52-week relevant period. And for the accrual method, you need to calculate the average weekly hours worked over the relevant period, and the employer is required to perform this calculation once per period of leave.
Get Trained on Annual Leave
We do offer a training course to help you with this: please see IPPE Holiday Pay & Annual Leave Accrual Training Course | CIPP
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