The Covid-19 Leave Support Scheme is available for employers and self-employed people to pay their employees if they need to self-isolate and they cannot work from home.

Eligible employees

To be eligible, an employee must fit within one the following categories:

1. Employee who is sick with Covid-19 and in isolation.
2. Employee directed to be in isolation due to close contact with an infected person.
3. Employee with dependents who are either sick with Covid-19 or who are self-isolating due to being a close contact.
4. Employee who has a serious health condition or someone  in their household is considered to be at ‘higher risk’ if they contract Covid-19.

An employee will not be eligible for this Scheme if they:

1. Are casual contacts with someone who has Covid-19.
2. Are a household member or a secondary contact with someone identified as a close contact of a person with Covid-19.
3. Are currently overseas.
4. Have returned from overseas and are in managed isolation.
5. Are returning international air crew.
6. Cannot work because they have to take care of dependents (unless those dependents are required to isolate).
7. Are unable to work because they have a reasonable belief that working during Covid-19 is harmful to their physical or psychological health.
8. Are unable to work for other reasons, for instance bereavement or sick leave.
9. Are already receiving the Covid-19 Leave Support Scheme or Short Term Absence payments.

It is important to note that an employee cannot receive more than one Covid-19 payment at the same time.

Eligible employers

Most employers and self-employed people are eligible to apply, including registered charities, self-employed persons, contractors, NGO’s, kindergartens and local government organisations.

State-sector organisations such as schools, universities and government agencies are not eligible.

How to apply:

Applications are made by eligible employers directly to Work and Income New Zealand, if they believe that an employee is an eligible employee based on the information provided by the worker.

Payments:

The payments are made in a 2-week lump sum for each eligible employee.  Eligible employees will be paid:

• $600.00 a week for full-time workers working 20 or more hours per week;
• $359.00 a week for part-time workers working less than 20 hours per week.

If the hours worked by the employee fluctuates each week, an employer should calculate the average hours worked each week over the last 12 months.  If an employee has been employed for less than 12 months, the average can be calculated over the last 8 weeks, unless a different time period is more appropriate for calculating the average hours (i.e. if an employee’s hours are better represented over the whole period of their employment).

Employers should pass the full subsidy onto their affected employees (less deductions), unless the subsidy amount is more than what the employee would usually be paid.  In that case, the employer can use the remaining subsidy to fund the wages of other employees.  Furthermore, employers must use their best endeavours to pay at least 80% of the workers’ usual income before Covid-19.

Employers will be able to treat the subsidy payments as exempt income for tax purposes.  Employers must however continue to make the usual deductions before paying their employees (for instance, KiwiSaver, PAYE, ACC levies, child support, and so on).  Employers are advised to contact the Inland Revenue Department, their accountants, or tax agent for further details.

An employer is able to keep re-applying for an eligible employee as long as the scheme is available and the employee is eligible.  If the employee returns to work in less than two weeks, and the remainder does not need to be topped up for other staff members, the remainder will need to be repaid.

Current application dates:

There are two COVID-19 Wage Subsidy August 2021 payments.  The previous two-week COVID-19 Wage Subsidy August 2021, which opened on 20 August 2021, has closed.

Applications for the second COVID-19 Wage Subsidy August 2021, known as Wage Subsidy August 2021 #2, are open for two weeks between 9am 3 September 2021 and 11.59pm Thursday 16 September 2021.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-priced Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins, we have an experienced family law team, who can answer your questions and put you back on track.

We are set up to help you remotely by telephone or video call.