Cuts to sick pay for unvaccinated staff who are self-isolating

In recent days, it has been announced that several retailers including Next, IKEA and Ocado have opted to remove company sick pay provisions for members of staff who are unvaccinated and required to self-isolate due to coming into close contact with a positive Covid-19 case. We have seen several changes to guidance on self-isolation requirements in the last couple of months, as a reaction to newly emerging Covid-19 variants and demands from UK businesses. The government has announced these changes to support essential public services and keep supply chains running over the winter. At the time of writing, the requirements are as follows:

1. It remains the law that you must self-isolate for 10 days if you test positive for Covid-19. However, you may leave self-isolation early, after 5 full days of isolation, following two negative lateral flow tests taken on consecutive days on days 5 and 6
2. Rules for contacts have remained the same for several weeks. Fully vaccinated individuals who have come into close contact with someone who has tested positive with Covid-19 should take lateral flow tests every day for 7 days, but there is no legal requirement to self-isolate. Meanwhile, unvaccinated contacts are legally required to self-isolate for the full 10-day period.

So far, British employers have seemed to steer clear of the tough stance that US employers have taken in relation to their workers’ vaccination status. However, we seem to have reached the point that employers are now considering steps they can take to limit their Covid-19 related expenditure. Unions have suggested that employers should be encouraging their workers to get vaccinated, but the focus should be on positive encouragement rather than imposing penalties on staff who have failed to get vaccinated. Some employers are now taking a tougher stance and cutting sick pay for employees required to self-isolate without testing positive. The retailer Next has been amongst the employers who have stopped paying company sick pay to unvaccinated staff. They state that they have been dealing with much higher levels of staff absence due to the Omicron variant. A spokesperson for Next has said that this topic is “highly emotive but we have to balance the needs of the business with those of workers and shareholders”. Next further went on to confirm that they will continue to pay vaccinated and unvaccinated workers sick pay if they test positive for Covid-19. Unvaccinated employees at companies such as Next, who are legally required to self-isolate for 10 days following close contact with a positive case, will now only be eligible for statutory sick pay (SSP) during their isolation period, unless there are mitigating circumstances. It is important to remember that some people are unable to be vaccinated due to medical conditions, or religious beliefs. Therefore, rolling out a blanket policy without considering mitigating circumstances could lead to significant backlash, including reputational damage and potential discrimination that could result in Employment Tribunal claims. Consideration should also be given to whether a contract provides for contractual sick pay because then if a company fails to pay it the employee would be able to bring a claim. When deciding whether to change a policy, employers should ensure that they can justify their policy on the basis of their legitimate businesses needs. In the case of Next and Ocado, they will likely be able to evidence that they were struggling with high levels of staff absence and therefore they deemed this policy change a relevant step to encourage vaccine take up. Beyond policies, if you intend to alter a contract you will need to follow a legal process. In these circumstances, we would suggest that employers undertake a full risk assessment to understand employees’ concerns about being vaccinated, consult with employees regarding the proposed changes, carefully communicate any changes to staff and take legal advice. This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.