European vs UK sick leave policies: A comparative overview for firms

Sick leave policies are an important element of workforce welfare, offering employees critical support during times of illness while enabling firms to maintain operational continuity. However, regulations and policies vary widely across Europe, which create both operational challenges and opportunities. In this article, we examine the key differences to guide firms operating across these jurisdictions, focusing on legal obligations, employee entitlements and employer responsibilities.

Switzerland: Comprehensive support through employer responsibility

Switzerland’s sick leave policies are among the most robust in Europe, combining employer obligations with opportunities for insurance coverage to manage costs effectively. Employers must continue paying salaries during illness, with specifics varying by region and the employee’s length of service. Cantonal scales, such as the Zücher, Berner, and Basler scales, determine the minimum salary continuation periods, ranging from three weeks during the first year of employment to several months for long-term staff.

To alleviate these financial obligations, many companies in Switzerland mitigate these costs through sick leave insurance. This optional policy typically covers employees for up to 730 days over 900 days. When this system is in place, it combines employer obligations with insurance protections, with employers paying the full salary during the initial waiting period, often around 30 days, after which the insurance provides 80% of the wages as a daily allowance. However, if no insurance exists, employers must pay 100% of the salary for the mandated period. Furthermore, Swiss law safeguards employees from dismissal during sickness for specific periods based on their tenure.

These measures, coupled with the structured insurance approach, ensure employees receive adequate support whilst incentivising firms to comply with regional and federal regulations.

Luxembourg: Employer accountability backed by state support

Luxembourg adopts a dual-layered model, ensuring employees receive robust income protection during sickness. Employers are responsible for salary payments for the first 77 days of sick leave. After this period, the National Health Fund takes over, reimbursing 80% of the salary while social security funds cover the remainder.

Strict procedural requirements accompany these benefits. Employees must notify their employer from the first day of absence and provide medical certification within three days. Failure to meet these obligations can result in dismissal. Additionally, cross-border workers, many of whom comprise Luxembourg’s workforce, are subject to these rules, and the government conducts checks to verify compliance.

Luxembourg’s policy framework ensures that employees are protected while employers’ benefit from state-backed financial relief for long-term cases. However, firms must navigate these obligations carefully to avoid penalties or disputes.

The Netherlands: Long-term commitment to employee wellbeing

The Netherlands exemplifies a progressive approach to sick leave, requiring employers to pay 70% of an employee’s salary for up to two years. Many companies voluntarily offer 100% salary coverage for the initial period, reflecting a cultural emphasis on employee welfare.

This system prioritises reintegration, with employers and employees collaborating to facilitate a return to work. Employers must also provide occupational health services, such as consultations with company doctors, to assess fitness for work and develop reintegration plans.

While this model offers extensive protections, it poses challenges for employers – particularly small businesses – due to the financial and administrative burden. Firms must ensure proper documentation and proactive measures to comply with these regulations while managing resources effectively.

The UK: A more discretionary based approach to sick leave

In the UK, sick pay policies are approached from a more discretionary standpoint. While Statutory Sick Pay (SSP) provides a fixed amount of £116.75 per week for up to 28 weeks, (which is lower than the percentage-based salaries compared to other countries), the first three days of sick leave, known as ‘waiting days’, are typically unpaid, dependent upon employer policy and contractual agreements.

Employers in the UK have the discretion to enhance this basic entitlement through occupational sick pay schemes via a compensation or benefits package. However, not all companies can or do opt for this, potentially leaving employees without sufficient financial support during prolonged illnesses. The reliance on SSP highlights the disparity between the UK’s framework and the more comprehensive European models.

This system reduces business costs but may impact employee satisfaction and retention rates if not properly managed. Firms operating internationally should consider aligning their policies with European norms to remain competitive in the eyes of European employees.

Summary: addressing disparities for effective management

It is clear that there are a diverse set of sick leave policies that exist in different jurisdictions across Europe. Switzerland’s reliance on insurance, Luxembourg’s state-supported system and the Netherlands’ long-term reintegration focus and the UK’s discretionary approach contrast sharply with one another.

For firms, these differences pose both challenges and opportunities. While operating in Switzerland or the Netherlands may require higher initial costs, these systems promote a healthier, more secure workforce. Conversely, the UK’s model may offer short-term savings but risks long-term productivity losses and employee dissatisfaction.

To succeed, firms must adapt to these varying frameworks, ensuring compliance while fostering a supportive environment. By investing in comprehensive sick leave policies, businesses can enhance their reputation, retain talent and boost operational resilience.

For support to navigate your firm’s sick leave policy in different jurisdictions, get in touch with one of our experts.