The government’s furlough scheme should cover workers infected with Covid-19 to prevent the spread of the disease by people who cannot afford to self-isolate, according to a leading thinktank.
With Britain’s statutory sick pay the lowest of any advanced economy, the Resolution Foundation said a more generous and easier to administer system should be put in place or the multibillion-pound vaccination programme was at risk of being undermined.
Until now unions, the Labour party and MPs from both sides of the Commons have called for the government to increase statutory sick pay (SSP) from £96 a week following concerns that low income workers were being plunged into poverty if they self-isolated.
Last month the head of the government’s test-and-trace system, Dido Harding, said her organisation was struggling to persuade workers to stay at home when they test positive for the disease.
“People are not self-isolating because they find it very difficult. The need to keep earning and feed your family is fundamental,” Harding told MPs.
The furlough scheme provides protection worth 80% of a worker’s salary and could be adapted to cover all employees who fall sick while the pandemic continues, the Resolution Foundation said.
It estimated that the monthly sick pay bill of £112m would increase to £426m a month if 643,000 employees used the scheme.
Self-employed workers should also get protection from the Self-Employment Income Support Scheme (SEISS) to make it affordable to stay at home and limit the virus’s spread, while the Employment and Support Allowance could cover those who are disabled or have long-term illnesses, it added.
SSP replaces less than a quarter of a typical employee’s previous earnings, compared with an average replacement rate of 60% in countries within the Organisation for Economic Co-operation and Development and the 80% replacement rate under the furlough scheme.
It was also the case that around two million people – many of them part-time workers in the retail, hospitality and leisure industries – were not eligible for SSP, the thinktank said.
The “Time Out” report said the government had implicitly acknowledged the limitations of SSP by introducing £500 test and trace support payments (TTSP) for individuals entitled to benefits, but only one in eight workers were entitled to them.
The TUC general secretary, Frances O’Grady, said: “The lack of decent sick pay has been a gaping hole in the government’s Covid strategy.
“Asking workers to self-isolate on £96 a week is not viable – especially when many don’t have savings to fall back on.”
TUC polling published in September showed that more than four in 10 workers would face financial hardship if they were forced to self-isolate for two weeks on SSP.
Maja Gustafsson, a researcher at the Resolution Foundation, said: “Coronavirus vaccines will take many months to roll out, so more workers will need to self-isolate at home to contain the spread of the virus next year.
“Given the failure of the current sick pay regime, the government must turn now to the far more successful job support schemes to provide workers and firms with the financial support they need to do the right thing.”