Covid-19 Wage Subsidy – Feel free to read the FAQ Document below
The Government has stepped up to assist employees by providing a wage subsidy scheme for which all employers can apply. Provided they meet certain conditions, employers can receive $585.80 for employees working 20 hours or more per week, and $350.00 for employees working less than 20 hours per week, paid as a lump sum covering 12 weeks per employee.
Since its announcement, the scheme has gone through several iterations. Broadly though, these key criteria have remained constant:
- Your business must have experienced a minimum 30% decline in actual or predicted revenue over the period of a month when compared with the same month last year (note changes for new and high growth businesses), and that decline is related to COVID-19;
- Your business must have taken active steps to mitigate the impact of COVID-19 (including but not limited to engaging with your bank, drawing on your cash reserves as appropriate, making an insurance claim and most likely talking to your accountant!); and
- You must make best efforts to retain employees and pay them a minimum of 80% of their normal income for the subsidised period.
I stress though this may not be the best option as an employer to take. Weigh up the additional costs of paying your employees (ACC, Holiday Pay, Kiwisaver) and make sure you make the best decisions to keep your business running in the long term. Also note that you can apply for this as a Shareholder Employee, Contractor or self employed. Even if you only have part time Self Employed work you can apply even if your employer in another job has applied for you.
Also important to know that your normal employer obligations still apply. Kelly from ThinkHR has put a lot of this together and has been awesome in regards to advising people about the correct procedure and policies to have when going through the wage subsidy.