Recruitment bodies write to Treasury asking to extend SSP rebate to larger firms

Various recruitment bodies such as the Recruitment and Employment Confederation (REC), Association of Labour Providers (ALP), the Association of Professional Staffing Companies (APSCo) and recruitment network TEAM have written to the Treasury asking them to expand the 14-day Statutory Sick Pay (SSP) rebate to include companies with more than 250 employees instead of only smaller ones.

The bodies have sent a letter to Jesse Norman, Financial Secretary to the Treasury highlighting the urgent need to extend the 14-day SSP support to all businesses.

The REC said:

As the furlough scheme comes to an end, recruitment businesses, many of which have few members of their own staff but a sizeable payroll of agency workers, simply will not have the cashflow to finance increasing numbers of SSP payments and this could become a solvency issue.

In the last week the REC has also written to Paul Scully MP, Minister for Small Business, to urge him to support the extension of SSP support. Before lockdown the REC also raised this on a number of occasions directly with Rishi Sunak MP, the Chancellor.

On 19/03/20, the Government announced that employers will be reimbursed for any COVID-19 SSP payments they have made since 13/03/20 from the 26/05/20 onwards. The coronavirus statutory sick pay rebate scheme which was announced during the March budget will be eligible to businesses who have a pay-as-you-earn (PAYE) payroll scheme and have fewer than 250 employees.

The letter reads:

Collectively our members support many thousands of individuals in work daily across the UK. Since the Coronavirus crisis arose in early March our members have been seriously concerned about their exposure to SSP, which is of course an employer cost payable from day one of sickness for COVID-19 related absence. They are grateful to Government for the prompt introduction of the Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020 and the rebate for those employers with less than 250 workers across all of their PAYE payroll schemes.

Nonetheless, our members are in a unique position; they may have few members of their own staff but a sizeable payroll of agency workers. Our largest members have agency worker payrolls running into the tens of thousands, dwarfing their direct employee numbers. This particularly exposes them to the financial impact of SSP, an employer cost they are unable commercially to claim back from end-user clients in most cases.

A Treasury spokesperson said:

We recognised that firms of all sizes would face significant financial pressure due to the pandemic. That is why we have introduced a raft of business support measures including the job retention scheme, billions paid in grants and loans, tax deferrals and business rates relief.

The design of the Statutory Sick Pay Rebate scheme recognises that small and medium sized firms would be placed under more financial pressure if Covid-19 led to significant staff absences. However, since its introduction, a full range of business support measures have been made available to UK businesses, including larger firms, who may be facing disruption as a result of Covid-19.