Maurice is ill: A story about sick pay
By Tim Thorlby
4 mins
1 – Maurice is unwell
Meet Maurice. He is a 34 year old front-desk receptionist with a smart suit and a winning smile. He works in one of the big glass skyscrapers in the City. You know the sort - full of banks and fintech companies and with a beautiful ground-floor atrium big enough to host music concerts. Maurice is originally from Brazil, he is good at his job and he is popular with the many office workers to whom he chats and dishes out security passes every day.
Today Maurice has a problem. It is Monday morning and he feels ill. High temperature, persistent cough, the chills. He should stay home. But he can’t, because his contract only offers Statutory Sick Pay, so he won’t get paid and that’s a real problem, because the family are already in a bit of debt.
He’s done the sums already. He’s on the minimum wage, so he earns £390 per week. If he calls in sick, he won’t get paid at all for the first 3 days and will then earn Statutory Sick Pay, which is only £21.88 per day. So, this week, he will earn £44 instead of £390[1].
No contest really. Maurice goes to work.
On the way to work, he coughs a lot and unintentionally passes his bug onto someone on the bus and three people on the Tube. At work, he passes the virus onto both of his co-workers on the front desk and Harvey, the CEO of Enormous Assets Ltd on Level 6. No-one knows all of this of course, but it’s what happens. We know it happens, because it happens every day.
Unfortunately, Maurice is so run down by his day at work that he has little choice but to call in sick on Tuesday and ends up being off for a whole week. His co-workers both fall ill by the end of the week too and aren’t there the following Monday. Agency staff are called in to plug the gaps.
Harvey felt rather ill too, if you were wondering, but fortunately he was able to work from home and enjoys full occupational sick pay anyway, so he was OK, thanks for asking.
2 – What happened next?
So what?
Maurice’s employer, Skyscraper Property Ltd, justifies the use of Statutory Sick Pay (the lowest level of sick pay an employer is allowed to offer by law) to ‘keep costs down’ because they think that’s what smart and responsible employers do.
Unfortunately, the low level of pay and benefits they offer to employees means that they rarely keep good front desk staff for very long, so their recruitment and training costs are consistently higher than average. Their rates of sickness absence are also higher than average, and the cost of Agency staff to fill the gaps means that their costs overran again. It turns out that paying occupational sick pay (paying Maurice his normal wage every day, even when he is off sick) might actually be *cheaper*, but no-one at Skyscraper Property Ltd has really thought it through.
Maurice ended up losing most of a week’s pay and missed a debt repayment, so he’s now in more debt than he was before. He loses sleep over this.
Harvey was fine.
3 – Welcome to the bottom of the barrel (bring your own face mask)
Statutory Sick Pay (SSP) is the lowest amount of sick pay that an employer can pay, by law. It is literally, the bottom of the corporate barrel.
Some 6.4 million workers in the UK today rely on Statutory Sick Pay[2]. That’s a lot of people, and mostly those on low wages. Maurice is a fictional character (just to be clear) but there are 6.4 million real people who face decisions like this every day.
The vast majority of salaried professionals (like Harvey) enjoy occupational sick pay of some sort.
The situation is actually slightly worse than you might think, as anyone who earns less than £123 per week doesn’t qualify for SSP at all; their employer doesn’t have to pay them anything at all when they are off work sick. This affects two million workers[3]. Most of them are women.
The UK’s Statutory Sick Pay is one of the lowest in Europe[4].
Even Matt Hancock, the former Health Secretary, recently told the Covid Public Inquiry that statutory sick pay was “far, far too low”.
During the Pandemic, the Government were forced to uprate Statutory Sick Pay to a more sensible level, to remove the incentive to go to work when ill. Sadly, this improvement was reversed at the first opportunity.
I remain surprised by how many ‘successful’ businesses in the UK seem happy to operate at the bottom of the corporate barrel, as though this was something to be proud of. Not only does it bring misery to employees affected by it, and often have unintended consequences for the rest of us, it is actually doubtful that it saves the employer money in the long run.
An analysis by WPI Economics suggested that a higher level of statutory sick pay would lead to lower sickness absence levels overall, higher productivity, a modest uplift in economic growth and lower levels of long-term ill health[5].
This would cost the taxpayer nothing, as sick pay is borne by the employer, and evidence suggests that employers probably get the investment back in terms of staff retention and lower absences overall.
My own experience of running a business offering decent sick pay is that it was exceptionally rare for anyone to abuse the generosity of higher sick pay and it was warmly welcomed as a sign that we actually cared about our workers.
4 – What do we do?
There is a strong case for Government to raise the statutory floor for sick pay, given how many employers seem to be unwilling to lift themselves off it voluntarily.
More decent levels of sick pay are not only good for workers, they benefit employers in the long run, boosting productivity and they reduce the incidence of long-term ill health, reducing demand for public services. Investing in a healthy workforce pays for itself.
Employers and employees have a mutual relationship; they benefit each other. This kind of relationship works best when it is not just narrowly defined in strict contractual terms but recognises that both sides are, well, human. Our marketplaces are not there to serve economic aims they exist to serve society; when we forget this, they cease to function properly.
All employers have broader social responsibilities to their employees and local communities, so any employer who wishes to treat their workforce with respect and dignity will have policies in place that protect them when they are ill. It’s what decent employers do. Employers also have a self-interest to do so, given the longer term benefits to them of treating their workers well.
Responses?
The Safe Sick Pay Campaign has been lobbying all parties at Westminster to support changes that would see Statutory Sick Pay apply to all workers, from day one, and require payment of their usual wages (up to the real Living Wage). They have been getting some traction recently, which is encouraging.
If you work for an employer then you can also check their sick pay provisions and if they are relying on SSP for any staff, or perhaps even you, ask to discuss this with them. Responsible employers don’t scrape the bottom of the barrel. It can be surprising what a bit of organisation and pressure can do; one of the joys of the marketplace is that anything is possible.
This blog was written by Tim Thorlby. Please sign up for the free monthly email if you’d like to know about future blogs.
Notes
[1] The Min Wage is currently £10.42 if you are over 23 and Maurice works 37.5 hours per week, so he usually earns £390. Statutory Sick Pay is currently £109.40 per week, so £21.88 per day except it only kicks in on Day 4 of your sick leave.
[2] TUC (2021) Sick Pay That Works | Available from: https://www.tuc.org.uk/research-analysis/reports/sick-pay-works
[3] As above
[4] The UK’s statutory sick pay is the third lowest in Europe, according to an analysis by The Compensation Experts, 2021 | Available at: https://employeebenefits.co.uk/uk-third-worst-europe-sick-pay/
[5] WPI Economics (2023) Making Statutory Sick Pay Work, Centre for Progressive Change | Available at: https://wpieconomics.com/publications/ssp-reform/