Legally, an employer is only obliged to pay for hours actually worked, unless the employment contract says otherwise. Most contracts won’t mention phased returns at all. That means you’re usually safe to reduce pay to match reduced hours during the phased period, as long as the employee agrees. 

But the legal minimum isn’t always wise. In practice, money worries can derail a return before it’s even begun. A short-term top-up now might avoid a longer-term absence later.

Three Common Approaches

There’s no one-size-fits-all rule, but these are the three most common models employers use:

1. Pay for hours worked only

The employee is paid strictly for what they do. So if they’re back for 50% of their hours, they get 50% of their pay. Clean and simple, but potentially stressful for the employee if they’re returning from a serious illness or financial strain.

2. Full pay throughout the phased return

Seen as a gesture of goodwill or as part of a supportive absence management strategy. Often used when the absence was caused by work-related stress or injury, or where the employee’s return is seen as high-value.

3. Tapered support

The employer pays full salary for the first one or two weeks, then gradually reduces it in line with the increasing hours. This softens the financial hit while still encouraging a structured path back to full-time work.

What to Put in Writing

Keep the wording simple. Your phased return agreement (letter or email) should include: 

• The phased return timetable (hours, duties, review dates)
• The pay arrangement and how long it will last
• Confirmation of how holiday, pension and bonuses will be handled during this period
• What happens if the plan needs to change 

Shared expectations reduce confusion. If you’re generous, say so. If you’re being pragmatic, say why. Most employees don’t mind the deal; they just want to know what it is.

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