A number of household name employers including IKEA, Morrisons, Next and Ocado have recently changed their sick pay policies for unvaccinated staff who are required to isolate as close contacts of someone who has tested positive for Covid-19. While vaccinated staff will continue to receive full company sick pay, unvaccinated close contacts will receive only statutory sick pay. These employers have pointed out that unvaccinated staff that test positive themselves will still continue to receive full sick pay. Unvaccinated staff who have mitigating circumstances will also be unaffected by the change in policy.
The logic behind the treatment of unvaccinated staff follows changes to rules on self-isolation for close contacts. While unvaccinated close contacts of positive Covid-19 cases must isolate for ten days, the period of self-isolation for fully vaccinated individuals has been gradually reducing. Currently fully vaccinated close contacts do not have to isolate at all, but must take a lateral flow test for seven days and exercise caution when mixing with others. So vaccinated staff who test negative can continue to attend work. Unvaccinated staff cannot which means more absences and related costs.
For employers considering making a change to a sick pay policy the first thing to consider is the terms of the existing one. Where an employer provides only the statutory minimum sick pay this will have to continue for all employees irrespective of their vaccination status. For employers who have a more generous contractual sick pay policy the first step is to identify the nature of the change to be made. If an employee tests positive, the official rules on self-isolation are the same irrespective of vaccination status, so the impact on the employer's business will be the same. Changing sick pay only for unvaccinated close contacts (where the official rules on self-isolation are different) is more likely to be considered reasonable and should be possible to justify.
It is possible though that the existing sick pay policy states that enhanced company sick pay is only payable in the event of absence related to ill health. Arguably, if the worker does not test positive then the entitlement to enhanced pay may not arise. However, in the earlier part of the pandemic many employers may have amended their policy to include those self-isolating, or have developed a practice of always paying enhanced sick pay irrespective of whether the absence was due to testing positive or being a close contact. In these circumstances, a change will be required and that will usually involve consultation, potentially on a collective basis, with a view to seeking agreement to the change. Even if the sick pay policy is discretionary rather than contractual, it will still be necessary to ensure any changes are reasonable and do not have a discriminatory effect.
If agreement to the change cannot be reached then the employer may still be able to impose it, although legal advice should be sought before doing this. Risks of imposition of the change include employees continuing to work but under protest, or even resignation and claims of constructive dismissal. Treating vaccinated and unvaccinated staff differently under the sick pay policy could also result in discrimination claims, although in some cases a defence of justification may be relied upon. Employers should also be careful to exempt any unvaccinated employees with good reasons for being unvaccinated from the impact of the change in pay.
Other factors to consider include how the policy is going to be used in practice when employees are under no obligation to confirm their vaccination status. Employers will also have to comply with the UK GDPR when processing information about vaccination status for the purposes of making decisions about sick pay. There is also the risk of unvaccinated staff, who should be self-isolating due to close contact, concealing that fact from their employer and attending the workplace. While this could be treated as misconduct, on a practical basis it may be difficult to uncover.
Most recently John Lewis announced that they would not be cutting sick pay, instead treating all "partners" the same way irrespective of vaccination status. It remains to be seen how many other businesses do seek to change their sick pay provision, particularly in light of recent announcements that the legal requirement for any self-isolation in England will end on 24 March 2022.
