Creating and Implementing a Company Sick Pay Policy for Your Startup
Creating and implementing a Company Sick Pay (CSP) policy for your startup is about managing expectations and creating something that fits your company culture while staying adaptable. Whether outlined in an employment contract or communicated separately, it’s essential to define eligibility clearly and ensure it aligns legally with statutory sick pay (SSP) requirements. Employees should feel supported during sickness absence, knowing their workplace values their well-being and provides clarity on their rights and benefits.
As an employer, you need a policy that balances cost, compliance, culture, and your team’s well-being. Remember, the initial policy isn’t set in stone—it can evolve as your team grows. Start with a simple, practical approach that works for your current team, and adjust it based on feedback over time.
Ultimately, it’s about making your team feel valued and trusted. It’s better to have a basic policy than no policy at all.
Policy Creation Pointers:
- Keep it Simple:
Use straightforward language. Your team should immediately understand their entitlements without consulting a lawyer. - Define Eligibility:
State clearly who qualifies for CSP. For example: “All employees are eligible for Company Sick Pay (CSP) from day one.” - Duration of Sick Pay:
Define how long employees will be paid when they’re off sick. Options include:some text- Up to 5 days of paid sick leave per year
- A hybrid of CSP and statutory sick pay (SSP)
- Notification Process:
Make it easy for employees to report their illness. For instance:
“If you are too unwell to work, notify your manager by email or Slack message as soon as possible, ideally before your scheduled start time.” - Proof of Sickness and Fit Notes:
Decide when a doctor’s fit note is required. For example, you might need one for absences longer than seven consecutive days. This strikes a balance between trust and accountability. - Supporting, Not Policing:
Frame the policy around supporting your team, not policing them. Add a statement such as:
“We trust you to use the sick pay policy responsibly and value your health above all else.” - Contagious Illness:
Encourage employees to stay home to prevent spreading illnesses to colleagues. - Mental Health:
Include mental health days explicitly. For example:
“Mental health is as important as physical health; mental health days are covered by this policy.” - Short- vs. Long-Term Illness:
Differentiate between short- and long-term illnesses. For instance:
“For longer-term absences, please reach out to discuss available support and options.” - Holiday Pay During Sickness Absence:
Clarify that employees continue to accrue holiday while on sick leave, ensuring their statutory holiday pay rights are protected.
Example of a Simple Company Sick Pay (CSP) Policy
Company Sick Pay Policy
We care about you and your health. If you're unwell, stay home, rest, and recover—we’ve got you covered.
- Eligibility: All employees are entitled to sick pay from day one.
- Paid Sick Leave: Up to 7 paid sick days per calendar year.
- How to Notify Us: Notify your manager if you're unwell, ideally before your start time, via Slack, email, or a quick message.
- Proof of Sickness/Fit Note: Required for absences longer than 7 consecutive days. Otherwise, we trust your judgment.
- Contagious Illness: Stay home to rest and prevent spreading illness to colleagues.
- Mental Health: Mental health days are included in this policy.
- Long-Term Sickness: For extended absences, contact us to discuss available support.
- Holiday Pay: Employees will continue to accrue holiday while on sick leave.
- Adaptability: This policy may evolve as our company grows, but our commitment to your health remains steadfast.
Implementing Your Company Sick Pay Policy
- Establish Clear Policies and Procedures:
Create a concise sick pay policy that includes:some text- CSP Details: Define how much and for how long CSP is provided.
- Integration with SSP: Clarify that CSP includes or supplements SSP, which is £116.75 per week and begins after three unpaid waiting days. (More information on Government SSP can be found in this article.)
- Accessibility: Make the policy easy to find, such as in the employee handbook or onboarding materials.
- Integrate CSP with Payroll Systems:
Ensure seamless payroll processing for both SSP and CSP:some text- SSP Automation: Use payroll software that calculates SSP automatically and complies with HMRC regulations.
- CSP Integration: Configure payroll to calculate additional amounts paid above SSP, ensuring error-free processing.
- Communicate Clearly with Employees:
Transparent communication is vital. Ensure employees understand:some text- Eligibility: Who qualifies and when.
- Notification: How and when to notify managers.
- Documentation: When proof of sickness or a fit note is required.
- Create an Efficient Notification System:
In startups, agility is key. Keep illness reporting straightforward:some text- Methods: Allow reports via email, Slack, or HR tools.
- Timeliness: Require notification within a set timeframe.
- Point of Contact: Assign someone to handle sick pay queries for consistent communication.
- Monitor and Record Absences:
Accurate records are essential for compliance and best practices:some text- Legal Compliance: Maintain SSP payment records, absence reasons, and related documents for at least three years.
- Tracking Tools: Use HR or payroll software to securely log and access records.
Conclusion
Sick pay isn’t just about legal compliance—it’s about showing your team you’ve got their back. Employees who feel supported are healthier, happier, and more engaged. A well-structured CSP policy, integrated with statutory rights like SSP and holiday pay, reflects a workplace that values its people.
Start simple, adapt as you grow, and help your team thrive. Healthy teams build great startups!
