Simon Collingridge and Rachel Watkins provide an update and explanation on the government’s ‘fit note’ initiative, as well as clearing up the confusion between statutory and company sick pay.
The practice of an employee providing their employer with a sick note has been in place since 1948. The employer’s policy will usually explain to the employee when they can self certify their sickness and when a sick note from their GP is required. Most employers require a sick note when the employee has been absent from work for seven or more days.
It is estimated that 172 million working days were lost to sickness absence in the UK in 2007, at a cost to the economy of over £100bn. Long-term absences lasting for over four weeks made up around 40% of days lost. In light of this, and following Dame Carol Black’s recent report into the health of the working population, the government announced that it will replace the current ‘sick note’ with a new ‘fit note’. This will be available in paper or electronic format. The government has started a 12-week consultation on the draft regulations, ending on 19 August 2009. The new system should be in operation in spring next year.
The consultation is prefaced on the assertion that the fit note will help reduce uncertainty for employers about when an individual can be expected to return to work. It will also enable employees to make their own informed decisions about when to return. It is suggested that organisations with generous sick pay schemes will benefit under this new proposal as it is hoped that returning to work will be made much easier and therefore quicker.
An early return to work
The objective of the government is to change the whole emphasis of the medical statement so that it helps doctors, employers and employees focus more on what the individual can do, rather than just their incapacity. The proposed change is designed to facilitate an earlier and possibly phased return to work. There will also be more support to help people back to work and employers will be encouraged to generally promote healthier living. The new fit notes will attempt to outline what duties an employee could do and these will only be passed on to employers if the employee agrees. Some are concerned that this requirement could in fact hinder the process.
It is hoped that the fit note will go some way towards improving links between the employee and employer by giving HR managers better information about a worker’s needs. This will enable them to engage in discussions about how to keep people in work. To help achieve this, GPs will be asked to work more closely with employers by being proactive and suggesting ways an individual could return to the job. This might, for example, involve alternative hours or different duties. The use of an electronic system would help employers to identify patterns of absence and deal with them accordingly.
Employers will be looking to manage sickness absence much more actively in future and it is hoped that the new fit note will help facilitate this.
Background
There are two types of ‘sick pay’, Statutory Sick Pay (SSP) and Company Sick pay (also known as contractual or occupational sick pay). Here is a summary of SSP requirements:
- Every employer is required to pay SSP to a qualifying employee for the first 28 weeks of sickness absence in a period of entitlement.
- To qualify an employee must have normal gross weekly earnings at a rate not less than the lower earnings limited for National Insurance contributions (£95 per week from 6 April 2009).
- There is no minimum length of service for payment of SSP.
- SSP is not payable for the first 3 days’ of sickness, which are classed as ‘waiting days’.
- SSP is currently set at £79.15 per week (from 6 April 2009).
- Self certificates are required for the first four to six days of sickness and a doctor’s certificate must be provided for seven days and over.
There are certain classes of employee who are exempt from SSP. This includes an employee on a short-term contract for less than three months, a pregnant employee receiving Statutory Maternity Pay or Maternity Allowance, or an employee in legal custody, amongst others.
Company sick pay
Some employers offer a sick pay scheme which is more generous than SSP. Details of the scheme will probably be in the employee’s contract of employment and may be detailed in an accompanying sick policy. Such a scheme may top up SSP so as to bring employees’ sick pay up to their basic pay. If the employer’s scheme is equal to or more than SSP the employer does not have to operate the SSP scheme as well.
Schemes vary enormously between employers but a typical scheme will usually start after a minimum length of service, such as, the completion of three months probationary period. Pay will usually be at the employee’s normal rate for a number of weeks. After this the employee is likely to receive half pay for a specified number of weeks before all pay runs out entirely.
These schemes are usually at the employer’s discretion. This means the employer can refuse the payment if it thinks the absence is unjustified. In refusing to pay under the sick pay scheme however the employer must be careful that the decision is free from discrimination. It is worth noting that just because an employer has paid discretionary sick pay in the past does not mean that it has to pay it in the future.
Under company sick pay schemes an employer may in some circumstances request a sick note before the 8th day of sickness. This is a service outside the NHS and a fee would be charged for the examination and sick note. The fee will vary depending on the GP. The employer is not obliged to pay this amount on behalf of the employee unless the contract of employment says it must do so.
Simon Collingridge is a solicitor, and Rachel Watkins is a trainee solicitor, from law firm Rickerbys LLP
One Response
The realistic angle to employee sickness
The principles behind reforming the medical statement are well intentioned but no one has assessed the financial implications for employers. The DWP’s own impact assessment on employers is restricted to generalist statements such as ‘ an early return to work results in savings’ and ‘ overall a net benefit is expected for employers’.
In fact, nearly all of the DWP’s anticipated net benefit to the economy of £350m over ten years is based on employers funding the necessary work place adjustments to achieve earlier returns to work. There is no evidence to suggest that this will be the case.
Here are some areas that should concern employers:
1. A GPs recommendation when they complete the new fit note is only going to be ‘generic advice on the functional effect of the individual’s condition’. Mo matter what occupational health training is planned for GPs in support, they are not going to be able to give the quality of advice that will inspire confidence in an employer spending money on a work place adjustment. As such, employers will need more occupational health advice which costs money. Most employers who can afford OH, already pay for it.
2. The DWP is seriously considering including the option for GPs to type in ‘occupational health assessment required’. Who is going to pay for this?
3. You could have the situation whereby a returning employee needs several work place adjustments paid for as they gradually return to full fitness. Is an employer going to fund all these?
4. If an employee is not part of a generous occupational sick pay scheme and can only rely on SSP, then they may want to get back to work earlier for financial reasons. If their employer refuses to pay for any work place adjustments – which they are entitled to – aggrieved employees may claim discrimination.
5. The legal liabilities that might ensue from a return to work based on different duties or workplace adaptations. What if the employee’s condition worsens as a result – who is going to be responsible for that? I’m sure most line managers don’t want to take that one on without being totally secure in their decision making.
I would urge all employers to read the DWP consultation paper for themselves just to understand what the practical implications may be. The consultation period ends 19th August.
John Picken
http://www.shandwell.com