Ikea cuts sick pay for unvaccinated staff
As you will have no doubt seen in the media, Ikea has made the decision to cut sick pay to Statutory Sick Pay (SSP) only, for unvaccinated staff who must self-isolate due to Covid-19 contact. Ikea has confirmed in a statement that they have made the below changes to their policy:
- “Fully vaccinated co-workers or those that are unvaccinated owing to mitigating circumstances which, for example, could include pregnancy or other medical grounds, will receive full pay.”
- “Unvaccinated co-workers without mitigating circumstances that test positive with Covid will be paid full company sick pay in line with our company absence policy.” and
- “Unvaccinated co-workers without mitigating circumstances who have been identified as close contacts of a positive case will be paid Statutory Sick Pay.”
To summarise, unvaccinated staff who are Covid-19 positive will still receive sick pay in accordance with Ikea’s absence policy. Whereas those who are unvaccinated and have been contacted by NHS Test and Trace as a close contact of a positive Covid-19 case and must self-isolate in accordance with Government Guidance will be entitled to SSP only, which is currently £96.35 a week.
In response to the policy change Ikea has stated that “We know this is a highly emotive topic and we appreciate there are many unique circumstances. As such, all will be considered on a case by case basis.”
On the face of it, amending sick pay entitlement for those not vaccinated against Covid-19, is legally possible, however extreme caution should be taken should an employer wish to impose such changes. Potential issues and concerns are discussed within this article.
It is also important to note that this article relates to the general working population and not care homes or health care providers which are, or will be, subject to different regulations.
Legal risks and implications
Even when there is no express contractual right to contractual sick pay, there can still be an implied term of enhanced contractual sick pay, if all the facts and circumstances indicate that it is custom and practice of the employer to pay enhanced sick pay to their staff.
Withholding contractual sick pay
Where an employment contract expressly provides contractual sick pay, it will only be possible to lawfully withhold contractual sick pay in situations specified in the contract of employment or the employer’s contractual sickness policy, or if the employee agrees in writing. Otherwise, withholding sick pay will amount to an unlawful deduction from wages under section 13 of the Employment Rights Act 1996.
Changes to pay and entitlements
An employer, who imposes a contractual change without the employee’s express or implied agreement, will be in breach of contract and the original terms of the contract will remain in place.
If an employee has been receiving discretionary sick pay and the employer decides to cease making discretionary payments, it may be advisable to give at least one-months’ notice of this intention to the employee.
An employer has three options should they wish to impose new terms, which in summary are:
- To seek the employee’s express agreement to the new terms (either individually or through a collective agreement).
- Unilaterally imposing the change and relying on the employee’s conduct to establish implied agreement to the change (discussed further below); and
- Terminating the employee’s employment and offering re-employment on the new terms (legal advice should be sought before adopting this approach which can be risky and difficult in practice).
The employee will then have various options, when deciding how to respond to the implementation of the new reduced sick pay terms, such as:
- Accepting the breach by carrying on working under the new terms of employment.
- Working under the revised terms “under protest” and bring a claim for breach of contract or unlawful deductions from wages.
- Resign and bring a claim for constructive dismissal, if the breach of contract is a fundamental breach going to the root of the contract. It is likely that termination of contractual sick pay will constitute the fundamental principle of mutual trust and confidence.
It is unwise to have a blanket policy in place stating that no Covid-19 unvaccinated employee will receive contractual sick pay, as this will likely disadvantage certain employees with protected characteristics under the Equality Act 2010 (EqA 2010) For example:
- Disability discrimination – Some employees with health conditions/medical exemptions have been advised against getting the Covid-19 vaccine. As such, employers must be careful and ensure that they do not discriminate on the grounds of disability under section 6 of the EqA 2010.
- Pregnancy-related discrimination – Some pregnant women choose not to be vaccinated against Covid-19 during their pregnancy or during their maternity leave (such as due to breastfeeding). Section 18 EqA 2010 provides that a person/employer discriminates against a woman ifin the protected period in relation to a pregnancy, she is treated unfavourably because of the pregnancy, or because of illness suffered by her as a result of it. Case law suggests that employers should exercise their discretion to continue payment of contractual sickness pay to women absent from work by reason of pregnancy-related illnesses.
- Religion or belief – Section 10 EqA 2010 states that a person should not be discriminated against on the grounds of their religious, philosophical belief or a lack of belief. Examples can include a Catholic person refusing the Covid-19 vaccine if foetal cell research was used in its production or an Ethical Vegan may refuse the vaccine if it was tested on animals or includes animal product.
Requesting that an employee provides proof of vaccination status or simply to confirm whether they are Covid-19 positive will be classed as special category data under GDPR and Data Protection regulations. GDPR and Data Protection implications must be dealt with appropriately. Steps can include completing a Data Protection Impact Assessment and ensuring that data is not retained unnecessarily.
Although cases should be considered on a case by case basis, when employers are deciding whether or not to extend discretionary sick pay to those who are not Covid-19 vaccinated, the decision should be applied consistently in each case and recording the reasons for each decision made. It is also sensible to make similar exemptions to that of Ikea, including medical exemptions and pregnancy-related illnesses.
As stated within this article, the right to cut discretionary contractual sick pay is possible, however, there are many considerations and it should be approached with extreme caution. We highly recommend that you seek legal advice before implementing such changes or if you are an employee who has been subjected to such changes.