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COVID-19 – Wage Subsidy Extension

As part of the Budget 2020 package, the government extended the Wage Subsidy to allow an extra 8 weeks of coverage per employee to provide continued support to those businesses who are still impacted after the Wage Subsidy ends.  The application period will be available from 10 June 2020 until 1 September 2020.

We recommend referring directly to the Ministry of Social Development website for the details of the Wage Subsidy Extension - it is up to employers to ensure that any declaration provided in the application for the subsidy is accurate.

The Criteria

At the time of writing this article, the government has released limited details regarding the application process, with more information available shortly. 

What we know so far is that before applying for the Wage Subsidy Extension, employers must wait until their original 12-week Wage Subsidy has finished, and must not receive more than one COVID-19 subsidy at a time per employee.

To be eligible for the Wage Subsidy Extension, employers will need to show an actual or expected revenue loss of at least 40% for a consecutive 30-day period.  This period must be measured in the 40 days before the application is made (however cannot be measured earlier than 10 May 2020) in comparison to the closest period in 2019.  This is a significant increase from the 30% decline that employers had to demonstrate in order to be eligible for the initial Wage Subsidy. 

If the application is approved, the Wage Subsidy Extension will be paid for a period of 8 weeks per employee, starting from when the application is submitted.

As was the case with the initial Wage Subsidy, the Wage Subsidy Extension will be paid to the employer as a lump sum, based on the same weekly rate as the Wage Subsidy, which is:

  • $585.80 per week for each fulltime employee (working more than 20 hours per week); and/or
  • $350.00 per week for each part-time employee (working less than 20 hours per week).

Employers have similar obligations to those under the initial Wage Subsidy, in that:

  • they must take active steps to mitigate the impact of COVID-19 on their business;
  • they will continue (on their best endeavours) to pay employees at least 80% of their income for the subsidy period;
  • they must pass on to their employees the full subsidy; and
  • they must retain employees on the Wage Subsidy Extension for at least the duration of the subsidy.

As is the case with all COVID-19 subsidies, employers must notify the Ministry of Social Development if their situation changes during the period that the Wage Subsidy Extension has been received and will be required to pay back any amounts they are no longer entitled to.

Employment Law Assistance

If you need assistance on applying for or managing the subsidy, please contact Renika Siciliano or Jerome Burgess.

Renika is a Director and leads our Workplace Law Team. She can be contacted on 07 958 7429.

Jerome is an Associate in our Workplace Law Team and can be contacted on 07 958 7427.


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