Unvaccinated staff could now be handed as little as £96.35 per week in statutory sick pay (SSP) during any periods of self-isolation.
Managers will consider mitigating circumstances when applying the policy which has been in effect since September.
The Swedish flatpack furniture retailer employs more than 10,000 staff in the UK across 22 stores.
An Ikea spokesperson said: “Following the vaccine roll out and changes in the Government’s isolation requirements, our approach to Covid-related absences evolved from the September 20, 2021 – an approach developed with our social partners and national co-worker committee.
“Fully vaccinated co-workers or those that are unvaccinated owing to mitigating circumstances which, for example, could include pregnancy or other medical grounds, will receive full pay.
“Unvaccinated co-workers without mitigating circumstances that test positive with Covid will be paid full company sick pay in line with our company absence policy.
“Unvaccinated co-workers without mitigating circumstances who have been identified as close contacts of a positive case will be paid Statutory Sick Pay.â¯We know this is a highly emotive topic and we appreciate there are many unique circumstances. As such, all will be considered on a case by case basis.”
People in England who are fully vaccinated – with at least two doses of most of the approved vaccines including Pfizer, AstraZeneca and Moderna – are not required to self-isolate if they have been in close contact with someone infected with Covid-19.
However, unvaccinated people contacted through the Government’s NHS Test and Trace scheme are required to self-isolate by law.
Similar rules are in place in Scotland, Northern Ireland and Wales.
Ikea is among other businesses including Santander and Asda which is encouraging its employees to get a Covid jab. Many offer paid time off for going to get vaccinated.
From Monday, staff at utilities firm Wessex Water who have not received at least one Covid vaccination or have no appointment to be vaccinated will only receive SSP if they are required to self-isolate as a close contact of a Covid case.
Wessex Water, which serves 2.8 million customers in the South West of England, said it has taken action to ensure it can continue its essential services after seeing staff absence rates double in the past week.
Workers self-isolating because they are infected with Covid-19 will still be paid their full wage.
A Wessex Water spokesperson said: “The vast majority of our workforce has been vaccinated and it’s important as a company providing essential services with key-worker employees [that] the remainder get vaccinated to protect themselves, customers and their colleagues.
“To make it easy for our staff, vaccine appointments can be booked in work time.
“Absences due to Covid have doubled in the last week, so we need everyone to be available so we can continue to provide uninterrupted essential water and sewerage services.”
Wessex Water said that throughout the pandemic it had not furloughed staff and anyone who had to self-isolate after contracting Covid received full pay.