Ikea reached ‘point of intense pressure’ with sick pay move

Unvaccinated UK staff who need to self-isolate will no longer receive sick pay at retail firm Ikea.

While the Swedish-owned business noted that the move was an “emotive topic”, it explained that the new policy was necessary with changing circumstances, reported the BBC.

Reflecting on this, Philip Richardson, partner and head of employment law at Stephensons, added that many businesses like Ikea have reached a “point of intense pressure” when it comes to staffing and costs they are facing, suggesting that many employers may follow suit in the coming weeks.

“Ikea’s decision highlights a shift in the way in which organisations are now approaching the pandemic, particularly those which are service led and reliant on staff being in stores, offices or in people’s homes,” he added.

In a statement, Ikea explained how the sick pay will be handed out: “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.

“Unvaccinated co-workers without mitigating circumstances who have been identified as close contacts of a positive case will be paid Statutory Sick Pay (SSP).”

The business employs around 10,000 people in the UK, who all take home around £400 to £450 a week.

But Ikea isn’t the first business to put in place such a policy, as Wessex Water’s new rule also comes into place this week.

The firm shared that any worker without at least one vaccination against Covid-19, who does not have a medical reason, or a confirmed vaccination appointment, will only receive SSP if required to self-isolate due to coming into contact with someone who tested positive.

Legal concerns

With a policy such as this, there are many legal implication employers could face, as Rustom Tata, chairman and head of employment at law firm DMH Stallard, explained: “Without a clear discretion, employees are likely to have a claim for unpaid wages or breach of contract”.

When discussing whether employers should consider offering only SSP to employees, he said: “In some cases, the contract of employment will be drafted in such a way that an employer will retain a degree of discretion as to whether or not to ‘top up’ any SSP entitlement (commonly up to full pay for a brief period of a couple of weeks per year). 

“However, many contracts provide that the entitlement to ‘company sick pay’ builds on the entitlement to SSP and so removing that element may be problematic.”

Sick pay pitfalls

Elsewhere, Marie Horner, partner in employment law at Langleys Solicitors, has pointed out that employers must be aware of their sick pay policies as there are many pitfalls they could fall into.

“In essence, if you have a formal contractual company sick pay scheme, it is imperative that the terms of that scheme are checked before any decision can be taken upon withholding company sick pay for unvaccinated staff on a period of self-isolation,” she enthused.

“Indeed, if you expressly have purely discretionary sick pay terms in your employment contracts, but the reality is that you always enhance pay for staff on sick leave, beware the pitfall of assuming that your scheme remains discretionary – it may not and advice should be taken before any decisions are made.”

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