As you would have read in the news, the government has announced yesterday a support package for those financially affected by the Coronavirus.
If you're an employer, contractor, sole trader or self-employed, you may qualify to get the COVID-19 wage subsidy.
To qualify:
Your business must be registered and operating in New Zealand
Your employees must be legally working in New Zealand
The 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, and that decline is related to COVID-19
Your business must have taken active steps to mitigate the impact of COVID-19 (ie talked to your bank or accountant)
You must make best efforts to retain employees and pay them a minimum of 80% of their normal income for the subsidised period.
How much you can get:
The COVID-19 Wage Subsidy will be paid at a flat rate of:
$585.80 for people working 20 hours or more per week
$350.00 for people working less than 20 hours per week.
The subsidy is paid as a lump sum and covers 12 weeks per employee.
This subsidy is for wages only. It is to help you keep your staff employed while you consider changes that may be needed while the disruption continues, and to ensure the future viability of your business.
The maximum subsidy that can be paid to a business is $150,000. Businesses can only get this subsidy once.
Employer obligations:
The subsidy is being administered under a high trust model and employers will not be asked for verification before the subsidy is approved.
However, MSD will have the ability to check applications and verify information at a later date. Where false or misleading information has been provided, employers can be subject to fraud investigation.
You need to have some details of the calculations that you have made to claim this.
Example of the financial benefit:
Employee on Salary of $60,000 = $1153.85 per week.
You reduce their hours by 20% - cost to you is therefore $923.08 per week.
You receive a subsidy of $585.80 per week.
Net cost to you is $337.28 per week.
This is $337.28 for 32 hours of 40 per week = equivalent cost of $10.54 per hour.
For more details of the criteria and definition, please go here:
You can apply directly in the above website too under the section “Apply for Wage Subsidy or Leave Payment”.
Please note that you will need to ensure, for those employees that you will apply the subsidy for, that they consent to their information being provided to the Ministry of Social Development. Please use the privacy statement from the link below that you can send to them and have them reply you saying they have read it and consent to it.
As always, OneTeam is here to assist if you have any queries. Together we are OneTeam.