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What do you pay when an employee is off sick during their notice period..?

Updated: Apr 27, 2022

The rules surrounding #sickpay are complex, none more so than when an employee is on sick leave during their notice period.

Many employers believe that only paying statutory sick pay (SSP) to an employee that is absent due to sickness during their contractual notice period is correct. But only under certain conditions will this be the case…

The Employment rights Act (ERA) 1996 states that the employer must pay full pay during the statutory notice period, where an employee is “incapable of work because of sickness or injury”.

When an employee resigns, their statutory notice period is always one week, although contractually they may be required to provide more notice. But where an employee is dismissed by the employer, the statutory notice period is one week for each complete year of service, up to a maximum of 12 weeks.

So if an employee has completed four full years of service, they will be entitled to 4 weeks’ statutory notice from the employer but unless there is a contractual notice period, the employee will only have to provide 1 weeks’ notice if they resign. In either case, the statutory notice period must be paid as full statutory notice pay if they are off sick during it.

However, there is an exception to the rule. Under section 87(4) of the ERA, the employee’s right to statutory notice pay does not apply where the employer’s contractual notice period exceeds the statutory notice period by at least one week. So in the above example of an employee with four years’ service, if the employer is contractually required to give 5 weeks’ notice or more, there is no liability for notice pay for any period of sickness absence during the notice period.

This is the case if the termination is the result of dismissal by the employer or resignation by the employee as it is always the employer’s notice obligation that is considered when deciding if the contractual notice exceeds the statutory minimum by at least one week or more.

The application of these rules can be confusing so it’s always a good idea to seek expert advice.

BHP Group can provide training in all areas of HR management to ensure your employees are being treated fairly and you remain compliant. Contact us today on 01243 641726 to discuss your training and support needs.

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