What to expect from the SSP Rebate and how to prepare your payroll


In his first budget, delivered less than a fortnight before lockdown began, chancellor Rishi Sunak indicated that many organisations would soon be able to reclaim the Statutory Sick Pay (SSP) paid for staff sickness absence caused by the coronavirus.

The measure will enable SMEs with fewer than 250 staff to apply to HMRC to recover the costs of paying coronavirus-related SSP. It is part of a package of support measures for businesses affected by the COVID-19 outbreak, announced by the Government over the past few months.  To ease the process, the government has also recently launched a new online service for SME employers to recover SSP payments they have made to employees.

This won’t, of course, ease the burden for every business. Large employers with more than 250 employees, still need to process SSP for employees off sick with coronavirus, shielding or self-isolating. That entails recording the new absence type in the appropriate section of the payroll system.

However, even smaller businesses will not necessarily be eligible for the SSP rebate.

Anne Stapleton, Outsourced Payroll Team Manager, Symatrix explains that employers are only eligible if they meet all the following criteria:

  • they’re claiming for an employee who’s eligible for sick pay due to coronavirus
  • they had a PAYE payroll scheme in operation before 28 February 2020
  • they had fewer than 250 employees across all PAYE schemes on 28 February 2020
  • they’re eligible to receive state aid under the EU Commission Temporary Framework

Employers should be aware that the repayment will cover up to two weeks at the applicable rate of SSP, and is payable if a current or former employee was unable to work on or after 13 March 2020 and entitled to SSP, because they either:

  • had or have coronavirus
  • could not or cannot work because they were/are self-isolating at home
  • were/are shielding in line with public health guidance

The HMRC web site will provide details of the records employers should keep and they must keep records of SSP that they have paid and want to claim back from HMRC. They must keep the following records for three years after the date they receive the payment for their claim:

  • the dates the employee was off sick
  • which of those dates were qualifying days
  • the reason they said they were off work – if they had symptoms, someone they lived with had symptoms or they were shielding
  • the employee’s National Insurance number

Employers can choose how they keep records of their employees’ sickness absence. HMRC may need to see these records if there’s a dispute over payment of SSP.

Even those businesses that are eligible for SSP rebates and that receive good advice on how to manage the process will not necessarily have payroll systems designed to support these transactions. Furthermore, it is unclear as to how they can prepare their systems to facilitate such employer refunds. These changes to SSP are, after all, part of a range of challenges payroll and HR teams have today that can be a nightmare to deal with if they don’t have the right processes and technologies in place.

Finding a Solution

Organisations are advantaged if they have already moved to cloud, as that will likely give them a strong security and governance infrastructure and the ability to remotely work in an agile manner  but they still need to set up their cloud approach properly. Many organisations have cloud payroll engines but if they are fed by another HR, time and labour and recruitment system (HCM) the data will originate in that system and that can cause efficiency problems. In contrast, a single cloud-based HCM and payroll system removes the requirement for data transfer from other systems to payroll and the need for manual interventions.

By moving to such a system, businesses can reduce risk and administrative burden, and achieve enhanced security. They can also add to the agility and flexibility of payroll. By embracing the combined capability of payroll and HCM operating as one, businesses can get more immediate access to the HCM and payroll data at their disposal and more quickly make adjustments.

Managed services can also have a key role. The benefit of outsourcing HCM and payroll to an expert partner is that rather than focusing on just delivering a payroll service, HR professionals can instead concentrate on being the positive contributors to both the HR and organisation strategy. If the third party has the capability to deliver HCM and payroll outsourcing as one solution on a single platform, then they have an opportunity to drive reduction of risks, significant efficiencies and automation into an organisation.

The key point, however, is that a single HCM and payroll system delivered in the cloud, is a driver for increased security; less risk and enhanced agility. It is interesting to note that the current period of lockdown has also been one of the busiest for financial processes and activities. On top of all that they will also have had to deal with a range of administrative challenges, of which the changes to SSP regulations is just one, albeit compelling, example. It will have been stressful for every payroll team but for businesses operating in the cloud, with a single HCM and payroll system, that process is likely to have been just a little less concerning. “