Current Times Update 4
Well now into Day 2 .. abit late today sorry .. the sun was there but now has gone and the rain is threatening here. Enough of the weather report and back to business.
No new updates from the Government in relation to further business support packages as yet. Also nothing from the IRD on tax payments, returns etc.
However by now you should have applied for the wages subsidy. Check out our blog posts for the criteria, process and links. From our experience, the subsidy is getting paid out quite quickly.
This update is around the options on paying employees. Have to say up front this is not definitive and we are dealing with an unprecedented time with nothing to refer to to guide us. However, having said that, the employment law and specifically the employment agreements still need to be followed even in this situation.
So the following is on the basis that you have applied and will receive the wages subsidy which involved confirming that you would use your best endeavors/efforts to retain the employees that you apply for the subsidy and pay them a minimum of 80% of their normal income:
Option 1: Pay your employees their normal gross wage. This means that you as the employer will be paying for the difference between the gross employee wage and the subsidy amount (full-time $585.80 and part-time $350.00)
Option 2: Pay your employees 80% of their normal wage. Again you will be paying the difference between this amount and the subsidy amount. However some employees will require more so an option is to top up out of their annual leave entitlement.
Option 3: We have had some clients who their employees have said we can just get paid the subsidy amount at this stage to get through .. which is very generous. Then as an employer you would work to top them up when things get back on track
With any of these options, you need to clearly communicate and engage your staff in discussions and get their agreement. As I said at the start, unprecedented times for both you and them.
Those are my thoughts and guidance. Any questions please email us.
Take care and keep safe.