Can an Employer Claim Back Statutory Sick Pay?

Can an Employer Claim Back Statutory Sick Pay? – Experts Guide

As an employer, you might be wondering: Can an employer claim back Statutory Sick Pay (SSP)? This is a common question—especially for small businesses that are balancing the cost of staff absence against rising overheads. Understanding whether you can reclaim SSP, and what rules apply, is essential to protect your business and ensure compliance with UK employment law.

Can Employers Reclaim Statutory Sick Pay?

Let’s address this upfront. In most cases, employers can no longer claim back Statutory Sick Pay from the government. This reclaim option was permanently removed in 2014. However, there have been exceptions during certain periods, such as during the COVID-19 pandemic. So, while it’s generally not reclaimable, there are some very specific situations worth understanding.

Why Can’t Employers Claim Back SSP Anymore?

Prior to 2014, employers could recover SSP payments through the Percentage Threshold Scheme (PTS). But the government abolished this scheme to simplify the system and shift responsibility onto employers. The official guidance from gov.uk confirms that the PTS no longer applies and employers must now budget for SSP themselves.

Was SSP Ever Reclaimable During COVID?

Yes, the rules temporarily changed during the coronavirus pandemic. Employers with fewer than 250 employees could reclaim up to two weeks of SSP per eligible employee if the absence was related to COVID-19. However, this temporary SSP Rebate Scheme ended on 17 March 2022.

What Are Employers Responsible For Now?

Today, employers must pay SSP directly to eligible employees for up to 28 weeks. As of 2025, the SSP rate is £116.75 per week. You must:

Pay SSP if your employee is sick for 4 or more consecutive days (including non-working days)
Keep proper records of absence and payments
Ensure the employee meets eligibility criteria

If you’re unsure about SSP eligibility, we can help you assess specific cases.

Can an Employer Claim Back Statutory Sick Pay in Any Circumstances?

At present, there are no general schemes available to reclaim SSP from the government. However, employers may explore options such as:

Occupational Sick Pay (OSP) policies that exceed SSP and are contractually agreed
Income protection or employer insurance policies (if purchased separately)
Claiming financial relief via other HMRC schemes (though these rarely cover sick pay)

None of these allow direct recovery of SSP itself, but they may reduce your risk and cost exposure.

Can an Employer Claim Back Statutory Sick Pay for Long-Term Illness?

This is a common concern for managers. Unfortunately, even in cases of long-term illness—where SSP is paid for the full 28-week entitlement—you cannot reclaim SSP from HMRC. It’s essential to have clear absence management policies in place, along with legal advice if you are managing capability or dismissal issues related to illness.

Managing Absence Without Reclaiming SSP

Since reclaiming is no longer an option, what should employers do? Here are a few steps we recommend to manage absence efficiently:

Ensure your sickness absence policy is up to date and consistently applied
Hold return-to-work meetings to discourage unnecessary absence
Keep full records of SSP paid and employee communication

If you would like free advice, John Bloor and the team are here to help. Call John today on 01625 874400 or email enquiries@ebslaw.co.uk for tailored support.

Statutory Sick Pay vs. Company Sick Pay

Many employers offer enhanced company sick pay (also known as Occupational Sick Pay). While you can’t claim back SSP, you can manage expectations and reduce disputes by:

Stating your OSP terms clearly in the employment contract
Ensuring you reserve the right to discretion where appropriate
Aligning your absence policy with business needs

We often support businesses in reviewing and updating these policies.

How to Avoid Mistakes With Sick Pay

One of the biggest risks to your business is misapplying SSP rules or failing to record payments properly. Mistakes can lead to HMRC penalties or employment tribunal claims. To avoid this:

Train your HR or payroll team on current SSP rules
Use a payroll system that tracks statutory payments automatically
Seek legal advice for complex or long-term absence cases

Can an Employer Claim Back Statutory Sick Pay in the Future?

There’s always a possibility that future government policy could reintroduce SSP support—especially for small businesses or during public health emergencies. However, there are no active plans as of now. Staying informed and taking preventive action is your best protection.

If the cost of sick pay is becoming a concern, it’s worth exploring business continuity plans and legal risk assessments. These can help you make smarter staffing and budgeting decisions while protecting your team and your bottom line.

Contact John Bloor today for expert support at EBS Law. We’re here to ensure your business stays protected every step of the way. Call 01625 874400 or email enquiries@ebslaw.co.uk.