Clarification of modification to wage subsidy scheme

Minister of Finance Grant Robertson has clarified that the changes to the wage subsidy scheme announced yesterday mean that employers should be passing on the full subsidy to workers, except in the case where the person’s normal income is less than the level of the subsidy.

“We still want employers to use their best endeavours to pay employees 80% of their normal salaries.  Where this is not possible, we want the value of the subsidy to be passed on.

“But to be absolutely clear if a person’s income is normally less than the subsidy they can be paid their normal salary.

“This is particularly an issue for part time employees some of whom normally earn less than the $350 per week.  We urge employers to use normal hours in the period before COVID-19 to assess the amount to be paid,” Grant Robertson said.

“This scheme is a high trust system in order to ensure that money reaches workers and businesses as soon as possible.  We urge employers to use the money provided by the scheme for the purpose it was intended, to support the wages of their employees.

“As stated yesterday we are chasing up examples that have been reported of misuse and we are standing up an audit capacity for the scheme.

“No employer who has applied since the announcement yesterday needs to re-apply.  The Ministry of Social Development will be processing those applications in accordance with this clarification,” Grant Robertson said.

Updated guidance on the scheme will be available from 3pm on the Ministry of Social Development website.