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Sick pay failing to keep pace with the cost of living

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Written by: Emma Lunn
20/12/2021
Statutory sick pay is worth £3 a week less now compared to start of pandemic, according to analysis by the Trades Union Congress (TUC).

The union body warns that hundreds of thousands of workers could be without decent sick pay while self-isolating over the Christmas period, risking further unnecessary transmission.

The TUC is calling for the government “to come to its senses and finally deliver decent sick pay for all” after calculating that the UK now has the lowest statutory sick pay in real terms in almost two decades. The last time real statutory sick pay was lower was March 2003 – almost 19 years ago.

The TUC said statutory sick pay is already worth £3 per week less in real terms now than it was at start of pandemic in February 2020, due to sick pay failing to keep pace with inflation which now stands at 5.1%.

The call comes as the Omicron variant rages and coronavirus cases surge across the country – with the highest number of daily cases ever recorded in a day last week.

The Times estimated that four million people will have to self-isolate over the Christmas period – four times the amount of 2020. The TUC warns that if this estimate is correct, hundreds of thousands of workers could be self-isolating without decent sick pay this Christmas – leading to further unnecessary transmission.

TUC research shows that about a quarter of workers get just statutory sick pay, and just under one in 10 get nothing at all. Recent analysis from the union body also warned that 650,000 workers over the festive period in sectors like hospitality, the arts and retail will have no sick pay.

The UK has the least generous statutory sick pay in Europe, worth just £96.35 per week. And it is only available to employees earning £120 per week or more – meaning two million workers, mostly women, do not qualify.

TUC research has found that this leaves around a third of workers – more than 10 million people – with sick pay that is too low to meet basic living costs, or with no sick pay at all.

Removing the lower earnings limit, which prevents those on low pay accessing statutory sick pay, would cost employers a maximum of £150m a year. And it would cost the government less than 1% of the test and trace scheme to support employers with these costs.

In July this year, the government rowed back on its decision to remove the lower earnings limit – in response the TUC accused ministers of “abandoning low-paid workers at the worst possible time”.

The government introduced a temporary scheme to assist people who face hardship if required to self-isolate. However, TUC research has found that two-thirds of applications (64%) are rejected – in part because the funding is too low, and many workers are not aware of it.

Frances O’Grady, TUC general secretary, said: “No one should be forced to choose between doing the right thing and self-isolating or putting food on the table. But this is the reality for millions of workers up and down the country who rely on our miserly statutory sick pay, or get no sick pay at all because they don’t earn enough.

“With the cost of living ticking up, statutory sick pay is worth its lowest in almost two decades – leaving millions of workers who fall sick struggling to pay the bills and get by. It’s a monumental failure that nearly two years into the pandemic, this vital public health tool has been ignored time and time again by the government.

“As the Omicron variant rages and coronavirus cases sweep across the country, it’s time ministers came to their senses and finally delivered decent sick pay for all. That means statutory sick pay you can live on and making sure everyone has access to it.”

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