The controls for the processing of Statutory Sick payments need to be set up on the Sickness tab of Payroll > Definitions > Module Definitions.
Linking Period holds the maximum number of days that can elapse between two periods of absence and the two absences be considered to be liked. (i.e. To not require another period of waiting before the employee is entitled to SSP – this is a statutory value).
Waiting Days holds the number of days that an employee must be absent before he becomes entitled to SSP – this is a statutory value.
Maximum Pay (Weeks) hold the maximum number of weeks that an employee can receive SSP – this is a statutory value.
Minimum Days holds the minimum number of days for which an absence must last for it to be included in the calculation of an employee’s SSP.
Prevailing Rate holds the value that is paid for one weeks statutory sickness. The rate is divided by the employee’s working days, as defined on the Sickness tab in HR Record > Payroll Details, to give a daily rate.
Deduct defines the default setting of this flag as passed down to all employees when first created. Id Deduct SSP payment is ticked, then SSP payments will be assumed to be included in the Gross Pay and a corresponding deduction will be recorded to allow the SSP value to be reversed. This figure is subsequently included in the statutory documentation produced at year-end. The flag may be overwritten at the employee level (HR Record > Payroll Details – Sickness tab), within Statutory Sick Payments or Working File.
Qualifying Mask define the days that make up the standard working week for SSP purposes. The details entered here are the default settings which are passed down to all employees when first created. The details may be overwritten at the employee level (HR Record > Payroll Details – Sickness tab). The number of days worked in a week, is used in conjunction with the Prevailing Rate to calculate a daily rate at which SSP is to be paid to the employee.
Automated Sick Pay Valid Absence Codes, if it is intended that SSP payments within Payroll, are to be generated from Absence entries from within Personnel. Then this field is required to identify which absence entries are to be used in the calculation. Multiple Absence codes can be entered, delimited by a comma. However, only single character codes are recognised.
Two system generated Payroll Codes are used to control the payment of SSP. The codes are SSPP for the payment, and SSPD for the deduction. (Note: if the payment is a notional payment for reporting purposes only). Both codes will have been generated when the system was set up.
The item that can be user defined in these screens are detailed below:
Payroll > Definitions > Module Setup > Payment/Deduction
On the General tab, the Description and the Payslip Description may be changed to affect how the payment or deduction appears on the payslip.
On the Controls tab, the Update Pay, Tax, and NI boxes should be ticked. The Pension box can be ticked if required and the General Ledger should be ticked if you are to post SSP payments to the General Ledger.
On the GEN tab, the details should be entered of how the SSP payments are to be posted to the General Ledger.
There is no requirement to use any of the other tabs for these two Payroll Codes.
Creating Statutory Sick Payments
It is possible to create Statutory Sick Payments by direct entry, through HR Record > Working File. However, when using this screen checking that the employee is entitled to SSP, has previous linking sickness, or has had more days SSP than the statutory entitlement, is the responsibility of the User.
Employee Number will be defaulted in when New is selected.
Payment/Deduction code must be entered as SSPP.
Description will then default to SSP Payment, but can be overridden.
Status will default to PAY, but can be changed if it is required to put the payment on hold.
Deduct will default to the value set on the Sickness tab of the employee’s Payroll Details, but can be overridden. If ticked, the employee’s SSP Payment will be balanced by an SSPD deduction entry and so the payment will not affect the employee’s Gross Pay.
Units should be set to the number of days SSP to be paid. This screen does not take linking days or waiting days into account, so the days entered here should be the actual number of days to be paid.
Rate should be set to the daily rate of SSP.
Value will be set to Units multiplied by Rate.
Statutory Sick Payments
This is designed specifically for the entry of SSP.
Payroll > Functions.
Click New and the above screen is presented.
Enter the Employee Number, As Required.
Enter the Start Date of the Absence.
Enter the End Date of the Absence.
The process will then check through the employee’s current Working File and historical Working File, to see if any SSP payments have been made in the Statutory Linking Period.
If a payment is found, then this box is defaulted to tick and the statutory waiting days are ignored when calculating the employees payment.
If no payment is found, then the box is defaulted to in-ticked and the statutory waiting days are taken into account when calculating the employees payment.
(Note: This field can be changed by the user, especially in the early days of the software, where historical SSP transactions may not exist in the system (Note: see section on Pre QLP Absence Details)).
The Deduct (Not Paid) flag will default to the value set on the Sickness tab in Payroll Details, but can be overridden. If ticked, the employees SSP payment will be balanced by an SSPD deduction entry and so the payment will not affect the employees Gross Pay.
Click Save and the record is added to the grid, which can be set to show the number of days that are to be paid, the daily rate and the total value.
Entries made through this screen are entered to the employee’s Working File and can be maintained via HR Record > Working File. However, it is recommended that they are maintained through Statutory Sick Payments to maintain the required level of validation. It is also recommended that SSP payments generated by Suggest SSP are maintained here.
A Payroll Calculation is not triggered by entries here, so it will be necessary to calculate either the Whole Template or the Individual Employees who have had SSP payments entered here.
The purpose of this wizard is to utilise the Absence Records of the HR module, to suggest that Statutory Sickness Payments for the Current Pay Period.
If a full HR implementation is not available, Absence Records are usually maintained as a Personnel function, then there will be no information available to review, and this function will be of no benefit as it will fail to recognise any potential payments.
If Absence Records are available, then it is recommended that this facility be utilised to avoid the duplicated entry of these details, in order to manually create the sickness payments for the same period of absence.
You will be required to complete the three pages of information before this function can continue:
Page 1 requests the Payroll Template to be analysed. This process will only review the Absence Records for employees associated with the selected Payroll Template.
This is a Mandatory element, which must be provided before the process can continue.
Page 2 requests the Start Date of the analysis and only Absence Records starting after or including this date will be considered. This is defaulted to the Start Date of the current pay period for the Payroll Template selected.
This can be manually overridden if required, but care should be taken to analyse consistent time frames, such as a whole pay period.
Page 3 requests the Last Date of analysis and only Absence Records ending on or before or including this date, will be considered. This is defaulted to the End Date of the current pay period for the payroll template selected.
This can be manually overridden if required.
This will be validated to be a date greater than the date accepted on the previous page.
Once all the details have been provided, click Finish.
The process will then review all Absence Records that satisfy the criteria provided, and suggest any potential payments.
The following must be considered when using this function:
- Once Absence Records of a pre-defined type will be examined in this process, (Note: holidays are also recorded as types of absences). A parameter in Payroll Parameter – Sickness tab, defines the absence types to be included.
- If you are operating a relatively new implementation, it is possible you will not have the records of previous sickness payments. When suggesting new payments, the system may recognise periods of absence as new sickness periods and subtract the defined number of waiting days (Note: as provided in the payroll module parameters). This may be incorrect if linked periods of absence have been processed in a predecessor system. It is possible to review the payments suggested within Statutory Sick Payments, and set the linked flag where necessary.
- The Statutory Sickness settings in Payroll Parameters – Sickness tab, are checked to ensure that the employee is entitled to a statutory payment.
- If a sickness payment is identified, then a transaction (Note: of payroll code SSPP), is created in the current payroll-working file, and audited as a standard payment creation facility. No specific audit report is produced describing the results of this isolated process, although the standard audit facilities will recognise the creation of a new payment.
- Payments generated by this process can be viewed and amended via Statutory Sick Pay (Note: as described above).
- A Payroll Calculation is not triggered by this process, so it will be necessary to calculate either the whole template, or the individual employees who have had SSP payments entered here.
Adjusting Statutory Sick Payments
If an under payment of Statutory Sick Pay is recognised, then it will be necessary to enter a deduction to the Working File, using a user created payroll code, and either Statutory or P14 to amend the Statutory Sick Pay year to date figure, (Note: depending on whether the overpayment was in this or a previous tax year).
The amount of Statutory Sick Payments that an employee has received in the current tax year, can be seen in Statutory, in HR Record > Balances. The values can be amended here if an incorrect amount has been entered against an employee in a past period.
The amount of Statutory Sick Payments that an employee has received in previous tax years, can be seen in P14 in HR Record > Balances.
The values displayed here can be amended by selecting Changes. Highlight the field to be amended and enter a new value.
Pre Software Absence Details
When the software has only recently been installed, it is possible that an Absence will be entered for an employee, that links to a payment that was recorded in some previous system.
The linking of such absences and the checking of the number of day’s sickness paid would ordinarily then become a manual process. However, it is possible to enter details of the employee’s last pre-software sickness payment into Statutory.
The Start and End Dates will be used to determine if the new absence should be considered linked to an old absence.
The number of Days Paid will be used to determine if the employee is reaching the end of his statutory sick pay entitlement.