Coronavirus sick pay scheme to go live in May

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Date: 19 May 2020

African American woman with flu virus blowing her nose at home

A new online system will allow small and medium-sized businesses to claim back Statutory Sick Pay payments they have made to their employees during the coronavirus pandemic.

The Coronavirus Statutory Sick Pay Rebate Scheme was announced in the March Budget as part of a package of support measures for businesses affected by the COVID-19 outbreak.

The scheme allows employers with fewer than 250 employees to apply to HMRC to recover the costs of paying coronavirus-related Statutory Sick Pay (SSP).

Businesses will be able to recover SSP payments using a new online service that is set to launch on 26 May. It means they will receive repayments at the relevant rate of SSP that they have paid to current or former employees for eligible periods of sickness starting on or after 13 March 2020.

Therese Coffey, secretary of state for the department of work and pensions, said: "This rebate will put money back in the pockets of millions of employers, ensuring they can hit the ground running as the economy reopens."

Angela MacDonald, HMRC's director general of customer services, said: "We want employers to be secure in the knowledge they will receive help as they care for their staff during this difficult period."

Employers are eligible if they have a PAYE payroll scheme that was created and started before 28 February 2020 and they had fewer than 250 employees before the same date.

The repayment will cover up to two weeks of SSP, and is payable if an employee is unable to work because they:

  • Have coronavirus; or
  • They are self-isolating and unable to work from home; or
  • They are shielding because they've been advised that they're at high risk of severe illness from coronavirus.

To prepare to make their claim, employers should keep records of all the SSP payments that they want to claim. Further guidance is available on the government website, including the criteria for eligibility.

The current rate of SSP is £95.85 per week. Employers can choose to go further and pay more than the statutory minimum. However, where an employer pays more than the current rate of SSP in sick pay, they will only be able to reclaim the SSP rate.

The scheme covers all types of employment contracts, including full-time, part-time, agency contracts and flexible or zero-hour contracts. Connected companies and charities can also use the scheme. Employees do not have to provide a doctor's "fit note" in order for their employer to make a claim.

Employers can furlough employees who have been advised to shield in line with public health guidance and are unable to work from home, under the Coronavirus Job Retention Scheme. Once furloughed, the employee should no longer receive SSP and would be classified as a furloughed employee.

Written by Rachel Miller.

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