In January, it was announced that some hospitality businesses would be given a 15% discount on their business rate bills, effective from April 2026, and that increases will be frozen for two years. This is a welcome break for some businesses operating in the food, drink and hospitality sector, however it is argued that hotels and restaurants have been overlooked.
This comes at a time when businesses are faced with other cost impacts, and this includes additional legislation updates associated with the Employment Rights Act 2025. Whilst the updates in this act supports employees financially, this does put pressure on businesses operating in the food, drink and hospitality sector putting additional pressure on running/operational costs e.g. employment costs.
From April 2026, the rules relating to Statutory Sick Pay (SSP) changes. Currently where an employee is absent due to sickness there is a three day waiting period before SSP applies. From April the three waiting days will be removed and employees will be entitled to SSP from the first day of absence. In addition, the lower earnings limit will be removed.
It is reported (Gov UK) that the changes in SSP will result in 1.3 million people on lower wages being entitled to receive 80% of their average weekly earnings, or the SSP rate which from April 2026 will be £118.75 per week.
Managing Sickness Absence
People get ill from time to time- this is a given. The changes in SSP will support genuine absences and provide financial support (reported that lower earners will be £100 better off). However, it is important that companies monitor their absence levels to ensure that the absence process and associated pay is not being misused. In 2025, the UK saw an increase (by 62% from pre-pandemic levels) in sickness absence. The average days per year per employee has increased to 9.4 days.
Having a robust sickness absence reporting processes in place, return to work interviews, and sickness absence triggers is key in monitoring and managing sickness absence levels, and for ensuring that the days lost due to illness does not escalate and become a problem. It’s tough managing shifts and allocating available employees to the working pattern at the best of times, without high sickness absence levels. Generally, in the food, drink and hospitality sector, the workforce will consist of permanent and casual workers, having flexible resources enables the business to flex during quiet and peak times, allowing seasonal workers during busy periods of the year.
At Nockolds, our team of lawyers and HR Consultants support clients operating within the Food, Drink and Hospitality sector, providing legal support and employment/HR advice.
To discuss your business and to find out how our team can provide support, reach out for a FREE initial consultation.