Statutory Sick Pay (SSP) is now payable from the first day of sickness, with the three-day waiting period removed and the lower earnings limit abolished. The change took effect in April 2026 under the Employment Rights Act 2025, and it widens SSP eligibility to workers who previously earned too little to qualify. For umbrella companies and recruitment agencies employing temporary workers, this alters both payroll administration and cost.
What Has Changed With Statutory Sick Pay?
Two reforms sit at the centre of the change. First, SSP is payable from day one of absence rather than the fourth qualifying day. Second, the lower earnings limit, which previously excluded the lowest-paid workers from SSP entirely, has been removed.
The combined effect is broader coverage. Workers on low or variable earnings, common in temporary and umbrella employment, now qualify where they would not have before.
For employers, this means SSP obligations can arise on short absences that would previously have fallen inside the waiting period. Every day of eligible sickness now counts from the outset.
Who Carries the SSP Obligation in Umbrella Arrangements?
In an umbrella arrangement, the umbrella company is the employer, and the SSP obligation sits with it. That has not changed. What has changed is the frequency and reach of the entitlement.
An FCSA Accredited Member employing contractors is responsible for administering SSP correctly, accounting for it in payslips, and applying the new day-one rules from the first qualifying period of sickness. Agencies placing workers through umbrellas should confirm their partners have adjusted payroll processes accordingly.
Workers are entitled to a payslip that shows how their pay, including any statutory payments, has been calculated. Transparency here matters, because deductions and statutory entitlements in the umbrella sector remain a focus of enforcement attention.
How Does the Fair Work Agency Fit In?
The Fair Work Agency has been operational since 7 April 2026, consolidating the enforcement work of HMRC’s National Minimum Wage team, the Employment Agency Standards Inspectorate and the Gangmasters and Labour Abuse Authority (GLAA) under a single body.
That consolidation brings statutory payments, minimum wage and agency standards within one enforcement remit. An employer getting SSP wrong is now dealing with a body that also holds the minimum-wage and labour-supply enforcement powers.
The Fair Work Agency has named minimum wage enforcement as an opening priority. In March 2026, HMRC named 385 employers and ordered £7.3m in repayments to 60,000 workers. Statutory entitlements sit within the same enforcement culture, and errors on SSP are unlikely to be treated as trivial.
What Should Employers and Agencies Do?
The practical steps are straightforward but need to be in place now:
- Confirm payroll systems apply SSP from day one and no longer apply the three-day waiting period.
- Ensure the removal of the lower earnings limit is reflected, so low-paid workers are correctly assessed for eligibility.
- Check that payslips show statutory payments clearly and accurately.
- For agencies, verify that umbrella partners have implemented the changes rather than assuming they have.
Getting SSP right is not only a legal duty. It is part of the worker-protection standard that distinguishes a compliant provider from one that treats statutory entitlements as optional.
FCSA’s Position
Day-one SSP and the removal of the lower earnings limit extend real protection to the lowest-paid temporary workers, and compliant employers should already have adjusted for it. The Fair Work Agency’s single enforcement remit means statutory-payment errors now carry the same weight as minimum-wage failures.
FCSA Accreditation is granted following assessment against the FCSA Codes of Compliance, which cover employment and worker-payment practices including statutory entitlements. To check that a provider meets these standards, consult the FCSA Members register before engaging an umbrella partner.
