Sick leave – Making changes to company sickness policy

By Peter Done on Small Business UK - Advice and Ideas for UK Small Businesses and SMEs

• How you change your policy is dependent on whether your policy is contractual or non-contractual. If the policy is clearly non-contractual, then you are generally able to make the changes you want to make and inform your staff.
• If the policy is contractual, then introducing changes to an employee’s terms and conditions requires agreement by both parties because one-sided changes are not permitted.
• When it comes to sick leave policy, stay up to date on statutory sick pay, the government guidance on fit notes, The Employment Rights Act 2025 and The Equality Act 2010.
• A consultation process is required where all affected employees should be informed of the intended changes, with an explanation of the reason why the changes are required.

Changing the terms and conditions under which your employees work, which is essentially what you would be doing making changes to a company sickness policy, should be done with careful consideration.

Firstly, your approach is dependent upon whether your sickness policy is contractual or not.

If the policy is clearly non-contractual and reserves the right to be amended from time to time, then you are generally able to simply make the changes you want to make and make your staff aware of this.

>See also: Can I dismiss an employee for sending threatening text?

If the policy is contractual and therefore constitutes part of your employees’ terms and conditions, then you need to tread more carefully. Introducing changes to an employee’s terms and conditions requires agreement by both parties because unilateral changes are not permitted – this means that you cannot simply impose a change unless it is required by law, as was the case when the indoor smoking ban was introduced.

When it comes to sick leave policy, make sure you’re up to date on statutory sick pay, the government guidance on fit notes, The Employment Rights Act 2025 and The Equality Act 2010.

Be especially careful of breaching The Equality Act. You should not be making any changes to your policy that could be viewed as discriminatory. For example, making changes to your sick leave rules which may impinge on a disabled employee’s rights, such as refusing paid time off for medical appointments.

A consultation process is required during which all affected employees should be informed of the intended changes, with an explanation of the reason why the changes are required. This needn’t be done by way of individual meeting – a memo/email to all staff, or a collective gathering, should usually suffice. If your employees are represented, for example by a trade union, then these representatives should be consulted. You should then give the employees the opportunity to raise concerns with you about the changes, and you should listen to any alternative ideas they may have.

Of course, it may be that the changes you wish to make will prove beneficial to your employees, in which case you are very likely to be able to make the change, after consultation, with no problem.

It may be that after consultation, your employees will understand the need for the changes and, even if some initial resistance occurs, will agree in the end. If strong resistance remains, employers have the option to terminate the current contract and simultaneously offer employees a new contract containing the new terms. This is a last resort and should not be taken without specific legal advice because it carries the risk of an unfair dismissal claim at Employment Tribunal. 

Changes in the Employment Rights Act 2025

The way that you approach a change to sickness policy has remained largely the same, but Statutory Sick Pay has changed. As of April 2026:

• Employees are entitled to sick pay from day one of their illness, rather than the day four previously
• The lower earnings limit is no longer in place

Find out more by reading An essential guide to Statutory Sick Pay for employers.

Peter Done is managing director and founder of HR consultancy Peninsula

Further reading

What is the legal number of hours employees can have between shifts?

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