Is low sick pay behind Britain’s “sick note culture?”

As staff absences due to sickness leave rise in the UK, the prime minister has pledged to clamp down on Britain’s so-called “sick note culture” and bring people back to work. But some say Westminster has misdiagnosed the problem.

According to a recent committee report by the Department of Work and Pensions (DWP), it’s Statutory Sick Pay (SSP) that needs reforming.

The report blasts the UK’s current sick pay system as “inadequate,” highlighting the meagre average 17% of wages offered. This figure means UK sick pay ranks among the worst in Europe; and substantially less than the average range of 70-100% found on the continent.

Is paltry pay the real reason workers are calling in sick? We delve into the data to see how the UK compares to other nations; and if hiked SSPs might heal the ailing labour market.

How does UK statutory sick pay compare to Europe?

Despite Westminster’s arguments to the contrary, research has shown that the UK workforce consistently takes fewer days off sick than any other advanced economy. One cause could be our below-average SSP, which ranks among the worst in Europe.

Using data from The Compensation Experts, we’ve listed the top 18 most populous European countries below to illustrate how their minimum sick pay rate (also known as the wage replacement rate) compares to the UK.

The data shows that Britain performs poorest overall for sick pay. Based on average weekly earnings, our wage replacement rate is 8% lower than the second-worst performer, Belgium.

On top of this, the Flemings will allow staff to earn this amount for up to 52 weeks, compared to the UK’s maximum window of 28 weeks.

Two Scandinavian countries (Denmark and Sweden) scored highest in the ranking, with Denmark even offering 100% remuneration for sick employees for up to 26 weeks. Both countries are known for their generous work conditions and benefits.

What is the UK sick pay rate?

Unlike the nations in the table above, the UK is an outlier in not calculating sick pay as a fixed rate of previous earnings. Instead, ill employees will be paid a set amount per week (known as Statutory Sick Pay) unless their organisation decides otherwise.

On April 6, the SSP rate in the UK increased from £109.40 a week to £116.75 a week for all employees who earn above the Lower Earnings Limit of £123 a week. This represented a 10% increase on the previous entitlement.

Based on the new figure, the average UK worker (who earned £677 a week in April 2024, according to government data) would earn just 17% of their average wages while off sick.

That said, many employers choose to offer their staff enhanced sick leave and pay to minimise the impact on salaries and prevent employees being penalised due to illness.

Those in low paid or insecure employment, such as minimum wage workers, are more likely to be paid SSP, as these roles typically don’t come with additional employee benefits.

Based on our calculations, a 21-year-old worker working a 40-hour workweek and being paid the National Living Wage of £11.55 per hour will still have their earnings slashed to around 25% of their normal rate if they become too sick to work.

What’s really behind the “sick note culture”?

Data from the Office for National Statistics (ONS) shows that unemployment figures are rising in the UK due to a spike in the number of workers on long-term sick leave.

The government is eager to get staff behind their desks. Pointing the finger at overzealous GPs handing out sick notes, it has suggested a complete overhaul of the system and the “sick note culture” it has supposedly created. This may include banning GPs from signing people off work.

The government’s concerns may be out of touch with reality, however. Meagre SSP means that many UK workers will earn under the weekly minimum wage if they are taken ill, forcing sick individuals to come into work anyway to fund their rising living costs.

Alongside violating health and safety regulations, this could be worsening the issue. Interfering in a person’s recovery will only delay their return to work, and could lead to health complications down the line.

Stephen Timms MP, Chair of the Work and Pensions Committee, said: “Statutory sick pay is failing in its primary purpose to act as a safety net for workers who most need financial help during illness. With the country continuing to face high rates of sickness absence, the Government can no longer afford to keep kicking the can down the road on reform.”

The report also finds that SSP remains too low, despite April’s increase. It argues that raising UK SSP rates would enable workers to budget for inevitable days off sick (and allow Britain to more closely compete with the rest of Europe) so they can get well enough to return to work.

In accordance with the law, the government has until the end of this month to respond.