The research identifies significant problems with the current sick pay regime in relation to preventing the spread of COVID-19. The report urges that the Coronavirus Job Retention Scheme (also known as furlough) should be used instead.
New research from Resolution Foundation, an independent think tank focussed on improving the living standards for those on low to middle incomes, calls for the Government to use the furlough scheme to encourage sick workers to self-isolate.
It states that, self-isolation is a key tactic to prevent the spread of coronavirus.
However, the Head of Test and Trace, Dido Harding, stated that some workers are refusing to self-isolate when necessary due to financial difficulty.
Currently in the UK, the only support available for employees who must self-isolate is Statutory Sick Pay (SSP).
However, SSP offers the lowest level of Government support across any advanced economy during COVID-19. Offering £96 a week, this report finds that SSP replaces less than a quarter of an average employee’s earnings. This contrasts greatly to the OECD (Organisation for Economic Co-operation and Development) average which replaces around 60 per cent of a worker’s earnings.
Additionally, as it stands, around two million workers that earn less than £120 a week are not entitled to SSP. This means that if they were to self-isolate, they would be left with no income at all. One in four part-time workers (25 per cent) and one in seven workers who work within retail, leisure and hospitality would not be eligible for SSP.
This problem has been implicitly addressed by the Government through the introduction of £500 Test and Trace Support Payments (TTSP), the research adds.
However, these payments are not having the intended reach. According to data from West Yorkshire, only 1,738 payments have been made between 12 October and 25 November. Overall, in the UK, only one in eight have been able to get access to these payments, leaving some workers vulnerable.
Therefore, Resolution Foundation argues the Government should introduce a “more effective, generous and easy to deliver” scheme which would use the Coronavirus Job Retention Scheme (CJRS), Self-Employment Income Support Scheme (SEISS) and Employment and Support Allowance (ESA).
It suggests that employees that need to self-isolate should be paid through the CJRS scheme which would ensure that they received up to 80 per cent of their previous earnings. It also calls for the self-employed to be paid pro-rata through SEISS if they have to self-isolate. Additionally, for self-employed people that are exempt from receiving SEISS should receive ESA instead, Resolution Foundation states.
The think tank estimates that paying employees who must self-isolate through the CJRS would cost £426 million a month which is up from current spending of £112 million currently spent on Statutory Sick Pay.
Maja Gustafsson, Researcher at the Resolution Foundation, said:
Getting people to self-isolate at home is one of the important tools we have in combatting Covid-19. But asking workers to do that often involves a major financial sacrifice – and the UK’s sick pay regime has been woefully inadequate in providing the necessary support. Many more Covid infections will have taken place as a result.
Coronavirus vaccines will take many months to roll out, so more workers will need to self-isolate at home to contain the spread of the virus next year. Given the failure of the current sick pay regime, the Government must turn now to the far more successful job support schemes to provide workers and firms with the financial support they need to do the right thing.
*This research was taken from Resolution Foundation’s report ‘Time Out’ which explores the eligibility, generosity and efficacy of the UK’s statutory sick pay regime and Test and Trace payments during the Covid-19 crisis, and considers the case for reform.