Government proposals to scrap the 'three waiting days' rule before employees are entitled to Statutory Sick Pay (SSP) could increase the number of sick days taken by people who are not genuinely unwell, the British Chambers of Commerce (BCC) warned today.Businesses are currently not required to pay SSP until the fourth consecutive day of an employee's absence. However, under proposals in the Welfare Reform Green Paper the three-day waiting rule would be scrapped and employers would have to pay SSP from an employee's first day of absence.

The consultation period for the Green Paper ends today. In its response to John Hutton, Secretary of State for Work and Pensions, the BCC said that scrapping the three-day waiting rule ran counter to the Government's stated aim in the Green Paper of simplifying absence management for businesses.

David Frost, the BCC's Director General, said today: "Giving all employees the right to SSP from day one would create a perverse incentive for individuals to take occasional sick days, which cause serious disruption for small firms. For small businesses the Government's proposals would make absence management more difficult, not less."

Mr Frost also warned that removing the three-day rule would increase costs for small firms. He said: "Many businesses operate occupational sick pay schemes that compensate employees from their first day of absence. Smaller employers, however, are less likely to offer such schemes at present so under these proposals they would incur increased costs.

"The proposal has been dressed up as a simplification measure, but it merely tinkers with the current regulations and leave many of the fundamental complexities in place. The Government is in danger of missing a golden opportunity to achieve real simplification of SSP."