Day One Statutory Sick Pay Is Coming

[sam]

Here’s what I’ve been thinking about and what we’ve been doing so far.

Like it or not, day one statutory sick pay is being introduced. For many small and medium-sized businesses like mine, it will change the cost and risk profile of employing people.

Much of the commentary so far has focused on whether this is fair, affordable, or another burden on employers. Those debates will continue and I absolutely encourage you to get involved, say your bit and fight your corner. It’s essential. Having a voice is a privilege. At the same time though, the more useful question is a practical one:

Is your business designed to absorb absence, or does it rely on perfect attendance to function?

Because the legislation itself is not what creates pressure. It exposes it. Let me explain.

Absence has always been a cost. We just didn’t have to face it on day one.

Sickness absence is not new. What is changing is who carries the cost, how quickly it appears, and how visible it becomes.

In many SMEs, absence has traditionally been absorbed informally:
• Work redistributed at short notice
• Owners stepping in
• Standards slipping temporarily
• Overtime increasing
• Productivity dipping without being measured

In short, all rather relaxed, flexible and human.

Day One SSP does not create absence, but it forces us all as business owners to acknowledge its real financial impact rather than hoping it evens out over time.

The real risk is dependency, not legislation

The businesses that feel this change most sharply are not the smallest or the least profitable. They are the ones that rely heavily on individuals rather than systems.
Where one person not turning up means:
• Work cannot be delivered
• Customers are affected immediately
• The owner is pulled back into operations
• Costs rise without warning

That is not a sick pay problem. It is an operating model problem which in a labour dependent business is a headache of a challenge.

What we’ve changed in practice, and why it matters now

Ours is a labour dependent business where people work alone and independently, absence has a direct and immediate impact. Probably one of the worst business scenarios. There is no easy cover, no shared workload, and no buffer.

So rather than pretending this legislation will not affect behaviour, we have accepted that it requires a more structured and deliberate approach to absence management.
That does not mean being unkind. It means being clear.

Here are some of the changes we have introduced that you may want to consider.

1. Tighter absence reporting rules
A text message for any absence is no longer sufficient. If someone is unwell, they must phone in and have a conversation for each day they are self-certifying. This removes ambiguity and reinforces that absence is a live operational issue, not an admin task.

2. Daily self-certification during absence
Staff are required to complete a self-certification form for each day they are absent. This creates consistency, clarity and a proper record, rather than relying on memory or informal updates.

3. More formal return-to-work conversations
Return-to-work interviews are now structured and recorded. They are not disciplinary by default, but they are purposeful. They provide an opportunity to understand what happened, reset expectations and identify any underlying issues early.

4. Using data to spot patterns, not to punish
Recording absence properly puts managers and business owners in a much stronger position to see patterns that need addressing. This might be repeated short-term absence, timing issues, or workload pressures. Without records, none of that is visible or useful in a disciplinary scenario.

5. Tighter medical information at recruitment
Whilst you cannot force disclosure, you can be clear about expectations. Our medical forms are more robust, and where something surfaces later that was not disclosed up front, we are in a stronger position to challenge the revelation through a fair but informed conversation.

6. Clear boundaries around what counts as sickness
Being off because off for a sick pet or for great aunty ‘Tilda twice removed’s funeral is no longer an affordable option. These situations require different conversations and different solutions. Blurring the lines helps no one.

7. Training managers to handle this properly
We are rolling out structured training for our managers, they are franchisees so business owners like yourself, so they can adapt confidently to this more formal, belt-and-braces approach. This is essential. Poorly handled absence management damages trust and costs money. Done well, it creates clarity and consistency.

8. Reviewing and re-launching absence policies
Policies have been reviewed, updated and simplified. Everyone knows where to find them and what they say. A policy that exists but is not understood is no protection for anyone, at all.

If you are an SME owner who is used to being flexible and human, trust me, I hear and feel your pain with these changes. The discipline and additional admin, yuk. Try focussing on the output, absence reduction=cost reduction. You can do it.

The uncomfortable conversation - pricing

Day One SSP is inflationary. There is no value in pretending otherwise.
Please do not sit back and wonder whether you can absorb the additional cost of Day One SSP. The government has legislated it, just as it legislates for the Living Wage. That means, like it or not, there is now another cost element that needs to be passed on to customers over time.

Most businesses already have a formula they use for annual price reviews to cover increases such as Living Wage, National Insurance and general overheads. Day One SSP now needs to sit alongside that as a separate consideration.

If you are not a numbers-happy person (you’re in good company), this will feel like a pain in the proverbial. There is no neat rule of calculation that fits every business type or sector.

We approached it pragmatically. We looked at national average sickness figures from two recognised sources. One quoted 9.5 days per year, the other 4.5. Not hugely helpful, so we settled on 7 days as a median and ran our calculations from there.
Is it perfect? Probably not. Will it be sufficient? Time will tell.

But we have done something. And at this point, doing something sensible and documented to protect your bottom line is far better than doing nothing and hoping it all evens out.

My final thoughts
If you’ve been in business for some time and this feels overwhelming, remember you pivoted through a pandemic, so you can definitely pirouette through an Employment Rights Act.

The introduction of day one statutory sick pay is as much about business resilience as it is personal resilience. You do have a bit of time yet, so break things down. Tasks, decisions, ideas for your business. Cup-of-tea-sized chunks. Don’t aim for perfection, just aim for done. You can polish it later.

And for those of you with an appetite for lobbying, remember the game isn’t up yet. Your MP and your favourite journo need to hear from you. Real-life stories, facts and figures, shared while legislation is being proposed and introduced, really do influence how it forms (or so I’m always being told). You are a business leader, and your voice matters.

Sam Acton is the founder of the Domestic Angels network of small businesses. She is a Member of the BCP Council Audit & Governance Committee and a Trustee of the Healthbus Charity. Sam has over 20 years’ experience building and supporting SMEs and regularly contributes to discussions on employment, governance and sustainable business growth in Westminster. https://www.linkedin.com/in/sam-acton/