Can contractors claim Statutory Sick Pay?

What is Statutory Sick Pay and how does it work?

In order to qualify for Statutory Sick Pay, or SSP, you must be classed as an employee, earning an average of at least £123 a week (2024 figures) and you will need to have been ill for over three consecutive days (this includes non-working days).

You need to provide your employer with a fit note (also known as a sick note) if you’re off work for more than seven days in a row, which can only be signed off by a healthcare professional, such as a GP or doctor, physiotherapist or pharmacist.

If you have time off work for continuous ‘linked’ periods (linked is if the periods last more than three days apart or they’re eight weeks or less apart) that last longer than three years then you will no longer for eligible for SSP.

Can contractors claim Statutory Sick Pay?

As mentioned previously, SSP can only be claimed if you are an employee, which means some self-employed workers do not qualify.

A sole trader is unfortunately one of those self-employed workers – you might be eligible for Employment and Support Allowance (ESA), which can be claimed whether you’re employed, self-employed or unemployed, but you will need to have paid enough National Insurance contributions.

You can apply for this online via the government website and you will need to have the following information to do so:

• A fit note from a healthcare professional
• Your doctor’s name, address and number
• Information about your income (if you’re working)
• Your National Insurance number and bank details

As a limited company contractor, you are employed by your company, which means you can claim SSP – however, you are then effectively paying yourself SSP, so it’s worth looking at your options and whether or not to look at ESA instead.

An accountant will be able to advise you on this.

Why can umbrella company contractors claim Statutory Sick Pay?

An umbrella company employs a temporary worker on behalf of an employment agency; the agency will then provide the services of the worker to their clients – it is effectively the ‘middleman’ between an umbrella company and their client.

Therefore, an umbrella company contractor counts as an employee, which means being entitled to certain employee benefits such as SSP.

Contractor emergency fund

As a self-employed professional, it’s worth considering having an emergency fund.

While there are many benefits to contracting, there are some downsides, such as not knowing how much you’ll be taking home each month – some months you may find yourself working all hours, others you might not have anything on at all.

And of course, you could find yourself unable to work for some time due to sickness.

It’s usually recommended that the amount in an emergency fund should be able to see you through for three months if you had no income.

So, whatever your monthly bills are, times that by three and you have your figure.

Of course, not everyone will have that sum of money straight away, and the thought of accumulating that amount can be overwhelming, but building it up slowly is better than not putting anything away at all.

It’s worth looking into a good savings account with high interest rates to help top it up as you go along.

We hope you found this page helpful. Our team of experts are available to answer any questions you may have, so either contact us via online chat, call us on 01442 795 100 or email sophie.lewis@dolanaccountancy.com.