Employer Handbook for Statutory Sick Pay

How to work out the relevant period

You need to work out the ‘relevant period’ to establish the earnings to be used and the earnings period. All earnings paid in the ‘relevant period’ will be divided by the number of days, weeks or months in that ‘relevant period’. Regulations define the 'relevant period' as the period between:

Date 1 the last normal payday before the first complete day of sick absence. This payday is Date 1 and is the end of the 'relevant period', and

Date 2 the last normal payday falling not less than eight weeks before the payday at Date 1. Date 2 is the day after this payday and is the start of the 'relevant period'.

You must include all the earnings paid on, or after, Date 2 up to and including those paid on Date 1.

If your employee has a contractual payday this is always the normal payday, even if you pay them early in a particular month.

Example – weekly paid employee

Employee paid every Friday.
First full day of sick absence 10/11/10.

The relevant period is therefore from 11 September to 5 November 2010.

Average Weekly Earnings – total earnings £970.21÷ 8 = £121.27625.

Do not round the average earnings figure up or down to whole pence.

Example – monthly paid employee

Employee paid on the last working day .
First full day of sick absence 10/11/10.

The relevant period is therefore 1 September to 29 October 2010.

Average Weekly Earnings – total earnings = £1,409.30 ÷ 2 x 12 = £8,455.80 ÷ 52 = £162.61153.

Do not round the average earnings figure up or down to whole pence.

For further examples and checksheets see How to work out Average Weekly Earnings (AWE).

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