The Government has opened up another wage subsidy support scheme to assist employers nationwide as the current Levels 2 across NZ and 3 for Auckland. This scheme is called the Resurgent Wage Subsidy. We have now had three rounds of subsidies, the Wage Subsidy (WS), the Wage Subsidy Extension (WSE) and now the Resurgence Wage Subsidy (RWS).
The Wage Subsidy
This was the initial subsidy that extended over a 12-week period when we initially went into lock down in March 2020.
You can no longer apply for this subsidy.
Wage Subsidy Extension
This subsidy was called to life to support businesses for 8 weeks after the initial lock down was lifted.
You could not apply for the WSE for an employee until their 12-week Wage Subsidy had finished.
Applications for this subsidy opened 10 June 2020 and will close just before midnight on 1 September 2020 (11.59pm).
If you have not claimed the WSE, you can still do so until 1 September 2020.
- You can apply to cover the wages of your employees over an 8 week period.
- You can apply for the WSE for your employee, even if you haven't applied for the Wage Subsidy for them before.
- You can't apply for the same wage subsidy for the same employee twice.
- If you have applied for the WS or Leave Support Scheme for your employee, you need to wait until those payments are finished before you can apply for the WSE.
- You can't receive more than one COVID-19 payment for the same employee at the same time.
Criteria to meet:
- You must be an eligible employer
- Your business must be in New Zealand
- Your employees must be legally working in New Zealand
- You must have a 40% decline in revenue for a continuous 30 day period. The 30 day period must be: in the 40 days before you apply (but no earlier than 10 May 2020) or compared to the closest period last year. The decline must also be related to COVID-19.
- You must be able to demonstrate attempts to mitigate the financial impact on COVID-19
- You must retain the employees you are applying for.
Resurgence Wage Subsidy
The RWS is a two-week payment for businesses who meet the criteria.
Your 2-week payment will run from the date you apply.
Applications can be made from 1pm on 21 August 2020 to 3 September 2020. It is open to employers throughout New Zealand.
This subsidy is for New Zealand employers who have had, or expect to have, a revenue drop of at least 40% because of COVID-19, for a 14 day period between 12 August to 10 September, compared to a similar period last year can get it. The subsidy is so businesses can keep paying their employees.
If you have already claimed, received and used the WSE, you can now apply for the RWS.
Criteria to meet:
The criteria to meet is the same as the criteria for the WSE, with the exception of the revenue loss period– for the RWS, you must have had or expect to have a revenue drop of at least 40% for a 14-day period, between 12 August to 10 September 2020, compared to a similar period past year.
The decline must also be related to COVID-19.
Payment rates and processing times:
The subsidy is for 2-weeks from the day you submit your application, and will be paid at a flat rate of:
- $585.80 for people working 20 hours or more per week (full-time rate)
- $350.00 for people working less than 20 hours per week (part-time rate).
When to apply:
You can apply for the Resurgence Wage Subsidy from 1pm on 21 August until 3 September 2020.
You can't receive the Resurgence Wage Subsidy if you are already getting other COVID-19 payments like the WSE or the Leave Support Scheme for an employee.
The online application process and information you'll need will be similar to the WS and WSE applications.
You'll be asked to declare you meet the criteria and agree to the obligations for the use of this payment. All payments will be subject to audits and reviews.
Leave Support Subsidy
The COVID-19 Leave Support Scheme (used to be 'COVID-19 Essential Workers Leave Support') is available for employers, to pay their employees who can't work. This means your employees:
- can't come into work because they are in one of the affected groups* and Ministry of Health guidelines recommend they stay at home, and
- can't work from home.
If you apply for the Leave Support Scheme before 1pm on 21 August 2020 you have to meet a revenue test. The revenue test (30% decline) won't apply after this time.
* Affected groups meaning employees who either:
- have tested positive for COVID-19 and are required to remain off work until they've been cleared by a health professional to be released from self-isolation, or
- have come into contact with someone who has COVID-19 and must self-isolate for 14 days (as required by Ministry of Health guidelines)
- are at higher risk if they get COVID-19, and Ministry of Health guidelines recommend they stay at home while public health restrictions are in place
- have household members who are at higher risk if they get COVID-19 and the Ministry of Health recommends the employee also remains at home to reduce the risk to them.
Refusal to work
Simply because there are wage subsidy or leave schemes available doesn't give staff the right to choose not to work during this period.
As the employer you have an obligation to pay your staff for work undertaken. Staff have an obligation to undertake work when required.
Provided you are complying with Government and Health regulations and directives during this period if your staff refuse to work and fail to provide a valid reason you may not have to pay them, even if you have qualified for a wage subsidy.
If they are not part of the 'affected groups' as above, they are obligated to attend work as requested. A refusal doesn't necessarily need to be paid and may also merit disciplinary action.
We suggest contacting us if you decide to take this path.
NB: If you need to vary any terms or conditions to an Employment Agreement even if it's temporary, remember it needs agreeing to and get a variation letter signed off with all staff concerned.
We have released updated variation agreements and non-payment templates in your Employers Toolbox Library
To apply for any of the available subsidies and for more information, click on the link below:
https://www.workandincome.govt.nz/covid-19/resurgence-wage-subsidy/index.html
For more guidance on which subsidy you qualify for, click on the below link:
https://covid19.govt.nz/business-work-and-money/financial-support/covid-19-financial-support-tool/