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Dan Martin

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Small businesses call for tax relief to help with sickness absence costs

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The Federation of Small Businesses has called for the introduction of tax relief to help employers cope with the high cost and administrative burden of sickness absence.

Ahead of the publication of findings from an independant review of the sickness absence system later this autumn, the FSB’s ‘Voice of Small Business’ survey revealed sickness absence cost small firms an average of £1,500 each in the last 12 months, with 9% losing out to the sum of £5,000 or more. 
 
The poll also showed that 40% of employers in this category found that dealing with sickness absence and holiday entitlement were the most difficult aspects of employment law. But the FSB claimed that tax relief for all firms with an annual National Insurance Contributions bill of less than £45,000 would help them recover statutory sick pay as well as ease the administrative burden.
 
The organisation’s national chairman John Walker said: “Small firms act like a tight-knit family and value the contribution their staff bring to the business. And research shows that staff in smaller firms are more often committed and loyal. But sickness absence is one of the most complex pieces of employment law they have to deal with. It can also be costly with small businesses paying around £1,500 over the past 12 months”
 
As a result, he called on the Coalition Government to provide small employers with tax relief for statutory sick pay in the same way that it currently did for statutory maternity pay. Such a move would mean that “those small businesses that experience a member of staff on long-term sickness absence are not hampered and are given the support they need,” Walker said.
 
Due to be published later this year, the independent review is expected to propose radical changes to the current sickness absence system.
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Dan Martin

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