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13 June 2012updated 21 Jul 2021 12:23pm

The UK’s forgotten workers without sick pay – and why new rules won’t help them

By Anoosh Chakelian

Rules around sick pay may be about to change, depending on a new government consultation announced this week.

At the moment, to receive statutory sick pay you need to earn at least £118 a week, be classed as an “employee”, and to have been ill for at least four consecutive days. The baseline pay is £94.25 a week for a maximum of 28 weeks, but your employer could have its own more generous sick pay scheme.

This system excludes a lot of people. Two million part-time workers and the lowest-paid who earn less than £118 a week. The 1.1 million gig economy workers, receiving little or no holiday or sick pay because they’re not technically employees. People on zero-hours contracts who don’t meet the earnings threshold (there are 850,000 workers on these contracts, which do not guarantee them a minimum number of hours’ work per week). The 4.93 million people who are self-employed.

The government’s new proposals could extend sick pay to that first group, and make the system more flexible to help phase them back into work after illness. It’s good news for low-paid and part-time workers, particularly the tens of thousands of people who never return to work after being off sick for a year or more.

But what of the rest?

The Department for Work and Pensions says that under the proposed new rules, gig economy workers will qualify for statutory sick pay regardless of income. But they still have to be employees working for an employer who pays secondary class 1 National Insurance contributions.

This definition can include agency and gig economy workers, but it depends on the nature of their contract – not all these kinds of workers are classed as “employees”. Unless the government is prepared to regulate this kind of employment specifically, it will continue to rely on the good will of gig economy companies to extend benefits to those they class instead as “self-employed contractors” – and the latter fighting their employers in the courts for basic worker rights (as I covered in this piece about Deliveroo couriers last year, which sums up the problem).

Zero-hours contractors are already eligible for statutory sick pay but only if they earn the £118 minimum. The DWP says individuals who are on a zero-hours contract, part-time contract, or any other type of flexible arrangement, can still be eligible for the same statutory employment rights as any permanent, full-time individual if they are doing the same work. But the difference for zero-hours contractors is that this is difficult to guarantee and easy for an unscrupulous employer to game, because by definition there are no guaranteed hours in zero-hours contracts. Again, unless it tightly regulates them, or abolishes zero-hours contracts altogether, the government’s new proposals cannot guard against this. 

As for the self-employed, if they are unable to work due to illness, injury or disability, they can apply for the Employment and Support Allowance benefit designed to help top up or replace their earnings.

But one in seven (611,000 people) of the self-employed UK workforce are disabled, according to IPSE (the association of Independent Professionals and the Self-Employed) and the Community trade union. If the government’s latest announcement is to help people with long-term illnesses or disabilities back into work then it makes no sense to ignore this group, as Frances Ryan, the journalist and author of Crippled: Austerity and the Demonisation of Disabled People, points out. “So many disabled workers go into self-employment because it’s our only option,” she tweeted.

While the consultation is good news for many, it’s crucial to remember the workers who will continue to go without statutory sick pay. They won’t be helped by these new proposals unless the government’s laissez-faire attitude towards precarious work changes.

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