Employer Handbook for Statutory Sick Pay

Your employee disagrees with your decision on their SSP entitlement

Written statement

If you decide not to pay SSP for a QD, for whatever reason,you should explain your decision to your employee.If they don't agree, they have the right to ask for a written statement from you about:

• those days that you regard SSP is payable for
• how much SSP you consider your employee is entitled to
• why you do not regard yourself as liable to pay SSP for other days in the period.

An employee can ask for a written statement at any time,and if the request is reasonable you must supply the statement within a reasonable time, for example within seven days of the request.

Formal decisions about SSP entitlement

If your employee doesn’t agree with your decision about their SSP entitlement, they can ask HMRC to make a formal decision. An officer of HMRC can also ask for a formal decision on entitlement.

HMRC is the first of the authorities who decide questions on entitlement to SSP. In practice, such decisions are given by authorised officers of HMRC. Their decisions are given strictly in accordance with the facts and the law.

Before asking for a formal decision from HMRC, your employee will be expected to have asked you for a written statement about their SSP position. Perhaps they will also have discussed the problem with you.

Both you and your employee will be asked for observations in writing. Neither of you will be asked to appear before the officer making the decision. You can both give supporting evidence. In the event of an appeal,your evidence will be copied to your employee and vice versa.

The officer making the decision will send the formal decision to both of you. If the decision is that your employee is entitled to SSP, the decision will give the time limit by which you must pay the SSP. You will be given full details of your appeal rights with the notice of decision.

If either of you appeals, HMRC will notify the other party.If you appeal, the officer making the decision will try to discuss the case with you so that the appeal can be decided by agreement between you, the officer and your employee.

Any agreement reached about the payment or otherwise of SSP must comply with the appropriate legislation.

If all parties are unable to agree you will be offered are view. Reviews are carried out by an officer not involved in the original decision. If you accept the offer of review,but do not agree with the review conclusion, you will have a further 30 days within which to notify the appeal to the independent Tribunal.

Once you have notified the appeal to the Tribunal, they will consider the appeal. You both have the right to appear in person and/or be represented at the hearing.

Tribunal decisions are final, except that you can appeal on a point of law, with leave, to the Upper Tier Tribunal.

If new facts come to light which affect the decision, the decision will be reviewed and, if appropriate, a revised decision will be issued. There are new appeal rights against this decision. It is in everyone’s interest to put all the facts before the officer making the decision in the first place.

SSP not paid after a formal decision that it is due

If you fail to pay SSP within the legal time limit following a decision:

• by HMRC that SSP is due and you make no appeal, or
• by an independent Tribunal that SSP is due at an appeal hearing,

you may incur a civil penalty.

Penalties

Legislation provides that employers failing or refusing to operate the SSP Scheme correctly can incur penalties. Like those in place for PAYE or NICs these penalties are civil (not criminal). The penalties cover the following offences:

• a refusal by you to allow access to your records or a failure to comply with a formal information notice both of which attract a maximum penalty of £300 and £60 for each day the failure continues
• a failure to keep records could make you liable to a penalty up to a maximum of £3,000
• should you provide incorrect information or documents,either fraudulently or negligently, in response to a formal information notice the penalty is up to a maximum of £3,000
• if you fraudulently or negligently produce incorrect records the penalty is up to a maximum of £3,000
• any failure by you to give your employee the required information up to a maximum of £300 and £60 for each day the failure continues
• the provision of incorrect information either fraudulently or negligently, to your employee could make you liable to a penalty up to a maximum of £3,000
• the refusal or repeated refusal or failure by you to pay SSP to your employee or the payment of an incorrect amount of SSP due to either fraud or negligence could make you liable to a penalty up to a maximum of £3,000
• obtaining, either fraudulently or negligently, incorrect funding could make you liable to a penalty up to a maximum of £3,000
• anyone who fraudulently or negligently makes an incorrect statement or declaration to establish entitlement to SSP could be liable to a penalty up to a maximum of £3,000

Where it is considered that a penalty is appropriate it will be imposed by either an officer of HMRC or an independent Tribunal, but in all cases there is a right of appeal.

Depending on the penalty type, any appeals against a penalty raised by an officer of HMRC will be heard by an independent Tribunal. Any appeal against a penalty determined by the Tribunal (on a question of law or against the amount) will be to the Upper Tier Tribunal.

The outcome of any appeal could see the penalty upheld, varied or dismissed.

In addition to the SSP penalties overleaf you also need to be aware that there is a penalty regime for errors on returns and documents, initially for VAT, PAYE, National Insurance, Capital Gains Tax, Income Tax, Corporation Tax and the Construction Industry Scheme.

For these taxes, it applies to returns or other documents for tax periods starting on or after 1 April 2009 that are due to be filed on or after 1 April 2010.

This means that if you don’t take reasonable care to get your taxes right you may incur a penalty for errors made during 2009–10 and later years.

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