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Rishi Sunak urged to extend sick pay for all workers

The Chancellor of the Exchequer is facing criticism from unions over the government's stance on statutory sick pay. Photo: Getty
The Chancellor of the Exchequer is facing criticism from unions over the government's stance on statutory sick pay. Photo: Getty

Rishi Sunak is being urged by unions to extend statutory sick pay for all UK workers.

The Trades Union Congress (TUC) and the Federation of Small Businesses (FSB) joined forces on Friday to call on the chancellor to remove the lower earnings limit for sick pay so that all employees can receive it, regardless of their earnings.

At the moment, the limit means that it's only available to employees earning £120 per week or more.

This leaves out an estimated two million low-paid workers who earn below this threshold- mostly women who are more likely to have lower paid jobs than men.

TUC general secretary Frances O’Grady said: “No one should be forced to choose between doing the right thing and self-isolating or putting food on the table. But millions of low-paid workers have faced this impossible choice.

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"Two years into the pandemic, it’s time ministers stopped turning a blind eye to this obvious problem and fixed our broken sick pay system."

Women are less likely to qualify for statutory sick pay as they are more likely to earn low paid jobs. Photo: Getty
Women are less likely to qualify for statutory sick pay as they are more likely to earn low paid jobs. Photo: Getty (Getty Images)

Read more: Gender pay gap fuelled by 'lack of pay transparency'

For many workers, the pandemic has highlighted the issue of sick pay because of the mandatory self-isolation period for those who test positive for COVID (currently five days).

During the peak of the Omicron variant in the UK, the ONS reported that 7% of adults in the UK were self-isolating, equating to around 2 million people out of the workforce in need of financial support.

As the pandemic begins to wane, the TUC and FSB are encouraging the government to learn lessons from the crisis and take “a fresh look" at the issue – arguing that there is “a new awareness of the need for people to protect their health at work, and to avoid the spread of respiratory viruses in the workplace”.

The TUC has been critical of the government's stance on sick pay since the start of the pandemic, claiming that it forces people to choose between protecting their health or bringing home enough money to put food on the table.

Read more: TUC calls for better sick pay provision for UK COVID absences

In addition, both unions want the amount of sickness absence pay to be increased.

Currently, employees can get £96.35 a week which employers are required to pay for up to 28 weeks.

However, as the UK battles with its cost of living crisis, workers who fall ill will have to budget in coming months to cope with rising energy bills which will take a 54% hike in April and record high inflation which is expected to peak at 7.25% in the same month.

The TUC claims some workers are having to choose between their health and their pay check. Photo: Getty
The TUC claims some workers are having to choose between their health and their pay check. Photo: Getty (Getty Images)

At the same time, the TUC and FSB want the government to help firms who are having to pay for supporting sick workers using money out of their own pocket.

Small businesses spent just over £3,500 each covering sickness pay last year on average, according to figures from the FSB.

Government figures show that there are just under 1.4 million employers with fewer than 50 employees across the UK, which puts the estimated cost of sickness pay to the smallest business at just under £5 billion.

In December 2021, the chancellor announced a temporary rebate scheme for business with fewer than 250 employees so that they can claim money to cover sick pay for employees who are affected by the virus.

The groups are calling for this rebate to be both made permanent and adjusted to cover all sickness absence, alongside the removal of the lower earnings limit.

FSB national vice chair Martin McTague said: “Small business owners are struggling to find £5 billion a year for sick pay costs. Last year, the Chancellor responded to our calls for help with a reintroduction of the small employer sick pay rebate until the end of March.

“However, with inflation driving up business costs, and forthcoming NICs hikes increasing the tax burden on them to a level not seen since the 1950s – there could not be a worse time to remove the rebate.

He added: “The Government should do the right thing and make the small employer rebate a permanent feature of how we manage workplace sickness, and protect small firms which help those with health challenges into work.

“Without this help, small firms will be forced to take difficult decisions on pay, jobs and prices.”

Watch: How to prevent getting into debt