Small firms call for sick pay rebate as free tests withdrawn and absence cost hits £5bn

Press Releases 1 Apr 2022

FSB responds to publication of the UK Health Security Agency's Living Safely with Covid guidance

Responding to publication of the UK Health Security Agency (UKHSA)’s Living Safely with Covid guidance and the withdrawal of free Covid lateral flow tests in England and Wales, Federation of Small Businesses (FSB) National Chair Martin McTague, said:

“The scaling back of working safely guidance and removal of free Covid tests at a moment when infection rates and inflation are soaring is going to throw up really challenging scenarios.

“Imagine you’re a sole trader struggling to make ends meet as bills spiral – you develop a tickly cough, you don’t have access to a lateral flow test, and at the same moment win a piece of work that would see you through the end of the month.  

“Or you’re a part time employee with caring responsibilities who doesn’t meet the lower earnings limit that ensures you qualify for Statutory Sick Pay – you start to feel under the weather, again no access to a covid test, but you feel well enough to work, and working from home is not an option.  

“The change in the new guidance from an instruction to “stay home” in the event of a positive test to “try to stay at home” and “talk to your employer about options” if you do want to come in will put stress on employers without the kind of support that’s existed in the past.

“A small firm isn’t like a big corporate – if one or two members of staff are away it puts huge pressure on the business – any more than that and it may consider closing for a while.

“The cost of workplace absence, including finding cover, surpassed £3,500 last year for the average small employer, meaning a collective £5bn cost to the small business community as a whole.

“Those additional outgoings come against a backdrop of the workplace testing initiative and small business sick pay rebate being withdrawn, along with wider Covid support measures.

“Small employers are acutely aware of their duty of care towards their teams. They now need more support to protect employee wellbeing.      

“That’s why we’ve worked with TUC to put forward proposals for a comprehensive small business sick pay rebate that would see the lower earnings limit removed.

“Given the circumstances we’re now in, the Government should look again at the future of workplace testing for those who cannot work from home.

“We’re urging the UKHSA and Health and Safety Executive to do all it can to proactively promote best practice around hygiene and ventilation, particularly as we move towards summer and the reopening of outdoor leisure spaces.

“We’d also urging everyone to respect the house rules that each individual small firm has chosen to implement – many have spent thousands from depleted cash reserves to make premises safer.”    

Media contact

Matt Dickinson

Matt Dickinson

Deputy Head of Media & Communications

[email protected]
07525 801773

About FSB

As the UK’s largest business support group, FSB is the voice of the UK’s small businesses and the self-employed. Established over 40 years ago to help its members succeed in business, FSB is a non-profit making and non-party political organisation that’s led by its members, for its members. As the UK’s leading business campaigner, FSB is focused on delivering change which supports smaller businesses to grow and succeed.

FSB offers members a wide range of vital business services, including access to finance, business banking, legal advice and support along with a powerful voice in Government. Each year FSB also runs the UK’s Celebrating Small Business Awards. More information is available at You can follow us on twitter @fsb_policy and on Instagram @fsb_uk.