Company Sick Pay vs SSP: What UK Employees Are Actually Entitled To

When you phone in sick, the amount you receive depends on two separate systems. Statutory Sick Pay (SSP) is the legal minimum: £118.75 per week for up to 28 weeks if you qualify. Company sick pay, also called contractual or occupational sick pay, is whatever extra your employer agrees to pay under your contract. Some workers receive full salary for six months. Others receive SSP alone from day four. The difference can amount to thousands of pounds over a single illness.

This article compares the two systems, explains typical employer policies, and shows you what to look for in your contract. Calculate your statutory baseline with our statutory sick pay calculator before you assume your employer will pay full salary.

Statutory Sick Pay: the legal minimum

SSP is set by statute and is the same across all qualifying employers. For 2025/26, the rate is £118.75 per week, paid for qualifying days after the first three waiting days in each period of sickness. It lasts a maximum of 28 weeks. You must earn at least £123 per week on average and be an employee who has been sick for four or more consecutive days.

Your employer cannot opt out of SSP. They pay it through payroll, deduct tax and NI, and reclaim some costs from HMRC if they qualify for the rebate scheme. SSP does not depend on length of service. A new starter who meets the earnings test is entitled from day one of eligibility, the same as a ten-year employee.

What company sick pay looks like in practice

Employer sick pay schemes fall into a few common patterns. Some pay full salary for a fixed period, often one to six months, then reduce to half pay or SSP only. Some pay a flat number of days at full pay per year, such as ten days, after which SSP applies. Some top up SSP to full salary for a limited period. Some mirror SSP exactly and add nothing, which is lawful if the contract does not promise more.

Public sector employers, large corporations, and unionised workplaces tend to offer the most generous schemes. Small businesses with tight cash flow often provide SSP alone. Startups may offer unlimited sick days as a cultural perk but without full pay, which sounds generous until you realise it means unpaid leave after SSP is exhausted.

Example: full pay then SSP

An employee earning £35,000 per year falls ill and has a contract offering three months of full pay followed by SSP only. For twelve weeks, she receives her normal salary of roughly £673 per week. After twelve weeks, pay drops to £118.75 per week until she recovers or hits the 28-week SSP limit. The total over six months is roughly £8,076 in full pay plus about £1,900 in SSP, far more than SSP alone would provide.

Example: SSP only

Another employee on the same salary with no contractual sick pay receives nothing for the first three qualifying days, then £118.75 per week. Over twelve weeks, total sick pay is roughly £1,068 after waiting days. The gap between the two employees is more than £7,000 for the same illness and the same salary. This is why reading your contract matters.

Where to find your sick pay terms

Check your employment contract first, then the staff handbook, then any collective agreement if you are unionised. Look for phrases like occupational sick pay, company sick pay, sick pay scheme, or full pay during sickness. Note the duration of full pay, any service requirement (such as six months before the scheme applies), and whether the scheme excludes certain conditions or has a annual cap on paid sick days.

If your contract is silent on sick pay, you are entitled to SSP only. Verbal promises from a manager are harder to enforce unless you have written evidence. An email confirming that the company pays full salary for four weeks during illness could form part of your contract terms if you relied on it.

How company sick pay interacts with SSP

Employers usually structure schemes so that contractual sick pay includes or replaces SSP rather than paying both on top of each other. If your contract pays full salary for eight weeks, the employer pays full salary and treats the SSP element as included. They still record SSP for HMRC purposes but you do not see a separate £118.75 payment because your salary already exceeds it.

Some contracts pay SSP as a minimum and top up the difference to full pay for a set period. In that case, your payslip may show SSP of £118.75 plus a company top-up of £554.25 to reach £673 weekly pay. After the top-up period ends, only the SSP line remains.

Model the statutory floor with the SSP calculator, then add your employer's top-up separately. Compare the total with your normal net pay from a UK salary calculator to see your real income during sickness.

Service requirements and exclusions

Unlike SSP, company sick pay often requires a minimum period of service. A common rule is that occupational sick pay applies only after a probationary period of three or six months. During probation, you may receive SSP alone even though colleagues with longer service receive full pay.

Some schemes exclude self-certified absences beyond a certain number of days per year, or treat repeated short absences differently from one long absence. A few policies reduce sick pay if the employee did not follow reporting procedures, though the employer cannot reduce SSP below the statutory rate for qualifying periods.

• Check whether company sick pay requires completion of probation
• Note any cap on paid sick days per rolling year
• Look for exclusions on pre-existing conditions in private insurance, not SSP
• Confirm whether part-time workers receive pro-rata company sick pay

What employers cannot do

An employer cannot pay less than SSP when you qualify for it. They can pay more. They cannot count annual leave as sick pay unless you choose to take holiday during illness. They cannot refuse SSP if you meet the conditions, even if they suspect malingering, though they can investigate and discipline if they find evidence of dishonesty.

If your contract promises company sick pay and the employer fails to pay it, that is a breach of contract. You can bring a claim for unlawful deduction from wages in the employment tribunal. Keep payslips, your contract, and records of sickness notification.

Sick pay for directors and small company owners

Directors who are employees of their own company qualify for SSP if they earn at least £123 per week through PAYE. Many owner-directors pay themselves a low salary and take dividends, which can leave them below the SSP threshold or with minimal PAYE earnings. Company sick pay schemes in micro-businesses are rare because the director is the person who would fund them.

If you run a small limited company, deciding whether to offer staff contractual sick pay is a cost judgment alongside salary, employer NI, and pension contributions. The sole trader vs limited company calculator helps compare structures, though sick pay obligations apply once you employ staff regardless of your own remuneration strategy.

Income protection as a backup

Where company sick pay is weak or absent, private income protection insurance fills part of the gap. Policies typically pay a percentage of your salary after a deferred period of four, eight, or thirteen weeks. Premiums depend on age, occupation, and health. Group income protection through an employer is more affordable but less common in small firms.

Income protection is particularly relevant for self-employed workers who have no SSP and no company scheme. Employees with only SSP should consider whether they can afford several months at £118.75 per week. The answer for many households is no, which makes understanding both SSP and any company sick pay entitlements essential before illness strikes rather than after.

Negotiating better sick pay

At job offer stage, sick pay is negotiable more often than people realise, especially for senior roles. Ask explicitly: how many weeks of full pay during illness, is there a service requirement, does the scheme top up SSP or replace it? If you are already employed and have a good track record, some employers will extend occupational sick pay informally for a serious diagnosis even if the contract is technically SSP-only.

Trade union members may have collective bargaining agreements that set sick pay above the statutory minimum. If your workplace is organising, sick pay is one of the benefits members commonly seek. Whatever your situation, know your statutory floor, read your contract for the ceiling, and plan your household finances for the gap between the two.

When you start a new job, ask about sick pay in writing before you sign the contract. A verbal assurance that the company pays full salary for three months is worthless if the written contract says SSP only. Equally, do not assume a generous policy applies during probation if the handbook says occupational sick pay starts only after six months. The gap between SSP and company sick pay is one of the least visible parts of a remuneration package until you need it.