Cutting sick pay for unvaccinated staff – The legal view

Ikea has recently announced that it will cut sick pay for unvaccinated staff who need to self-isolate because of Covid exposure, and in some cases for workers who test positive. The retailer’s reasoning for this was said to be due to company policy evolving with changing circumstances. Amanda Glover, Senior Solicitor of Clarkslegal caught up with us to discuss why businesses are legally allowed to implement this.Amanda is a senior employment solicitor in the employment team and advisor at forburyTECH, a tech start-up and scale-up support service, run by Clarkslegal.

As well as representing clients on both contentious and non-contentious workplace matters, including disciplinaries and grievances, discrimination and equal pay issues, Amanda has significant experience managing and supporting industrial relations matters, large-scale changes to terms and conditions, and working on cross-border HR and employment law projects for global brands. 

“It is perhaps unsurprising given the terrible impact of the COVID-19 pandemic on individuals and society, that being unvaccinated is considered, in many quarters, to be anti-social behaviour. The response to this has manifested itself in different ways across the world. In France, President Macron vowed to make life uncomfortable for the unvaccinated. In Australia, a tennis star was deported on the basis he might stoke anti-vaccine sentiment. Austria has taken the first steps to introduce a law to make vaccination mandatory, and in Greece, individuals are facing repeat fines until they get vaccinated.

In the UK, the Government has made vaccination a condition of employment and continued employment in care homes since 11 November 2021. Some employers such as IKEA and Morrisons have stated they will start to pay differentiated levels of sick pay based upon an employee’s vaccination status. To be clear, where employers suggest reducing sick pay for unvaccinated staff, they are generally talking about either reducing the level of company sick pay paid, or entirely eliminating any company sick pay for unvaccinated staff, leaving them only with the legal minimum Statutory Sick Pay entitlement. Generally speaking, employers are also only looking to make reductions to company sick pay where the unvaccinated member of staff’s absence is COVID-19 related.

It is important to note that whilst not being vaccinated in the UK might be considered anti-social, it is not illegal. The UK has a long-standing policy that vaccination should be advised, but not mandatory.

That said, some employers are showing a willingness to differentiate between employees and between prospective employees based on their vaccination status. Employers can do this because discrimination in employment per se is not illegal. However, discrimination against a person is illegal where it is because of one of the nine Protected Characteristics outlined in The Equality Act 2010 (such as race, disability, sex or age). Vaccination status is not one of these nine defined Protected Characteristics. That said, employers must be very careful about treating vaccinated and unvaccinated staff differently for two main reasons.

First, the reason for an individual’s vaccination status could link to one of the Protected Characteristics. By way of example, individuals with certain health conditions have been medically advised not to get vaccinated, and their health condition could constitute a disability under the Equality Act 2010. Under the Act, a person is considered to be disabled if they have a physical or mental impairment which has a substantial and long-term adverse effect on their ability to carry out normal day-to-day activities. In these circumstances, it could be unlawful to treat the individual less favourably or put them at a disadvantage for a reason (vaccination status) that relates to their disability. Denying an individual employment or paying them lower rates of sick leave could put the individual at a disadvantage and could count as less favourable treatment.

Secondly, employers need to be mindful of the contractual position when making any changes. The fundamental principle here is that employers do not have the right to unilaterally vary terms and conditions of employment. If an employer were to decide it wanted to change its contractual sick pay provisions, so that those who were unvaccinated received no or less company sick pay, employees could bring claims for unlawful deduction from wages or breach of contract. Unless an employer’s contractual sick pay is entirely discretionary, employers would need to agree any changes to the contractual sick pay terms with the employees before changes could be made. If agreement cannot be reached upfront, an employer would need to fully consult with all affected employees about the proposed sick pay changes. If staff still did not agree with the changes post-consultation, employers are left with little option but to; give up on making the change, impose the change, or dismiss and reengage employees on the new terms. Clearly the last two options are very risky for employers, and morale will already be low given the divisiveness of the topic at stake.

It is important then for employers not to get carried away with the current rush to exclude the unvaccinated from company sick pay. Employers must think through what it is they are trying to achieve by such actions and consider the potential employment law consequences.

Beyond the employment law consequences though, employers also need to think through the employee relations consequences. For example, it may well be that unvaccinated employees are good employees and any moves to treat them differently might cause them to become disengaged or even leave their employer, thereby causing disruption to the company and co-workers alike. There are then potentially serious legal consequences which stem from getting decisions like this wrong and employers should be aware of this. If unsure, employers should reach out to seek employment law guidance from a trusted adviser.”