Wage Subsidy Extension
Updated: Jun 9, 2020
Current at Monday 8 June 2020
The Wage Subsidy Extension will be available from 10 June 2020 until 1 September 2020 enabling business owners to keep paying their employees. A Wage Subsidy Extension payment will be available to support employers, including sole traders, who are still significantly impacted by COVID-19 after the Wage Subsidy ends. To be eligible for the Wage Subsidy Extension you must have had, or expect to have, a revenue loss of at least 40% for a 30-day period in the 40 days immediately prior to the application date (but beginning no earlier than 10 May 2020), compared to the closest period last year.
Please be aware that going to Level 1 may boost your revenue meaning that you become ineligible.
The application period is from 10 June to 1 September. However, you cannot apply until your first 12-week wage subsidy ends. You cannot receive more than one COVID-19 payment for the same employee at the same time. For example:
If you applied for the first wage subsidy on 17 March, you will be able to apply for the wage subsidy extension on 10 June
If you applied for the first wage subsidy on 27 March, you cannot apply for the wage subsidy extension until 20 June
If you applied for the first wage subsidy on 28 April (When we dropped from Level 4 to Level 3), you cannot apply for the wage subsidy extension until 22 July
The criteria for the Wage Subsidy Extension is the primarily the same criteria and obligations as prior subsidy:
You must have had, or expect to have, a revenue loss of at least 40% for a 30-day period in the 40 days immediately prior to the application date (but beginning no earlier than 10 May 2020), compared to the closest period last year. How to calculate a drop in revenue here.
It will be paid to you as a lump sum at the same weekly rate as the first wage subsidy ($585.80 for full time employees and $350 for part time employees)
You must pass the subsidy on to your employees
You must retain your employees for the duration of the subsidy
You must do your best to pay your employees at least 80% of their normal pay
You must take active steps to mitigate the impact of COVID-19 on your business
The Wage Subsidy Extension will cover 8 weeks per employee from the date you submit your application.
If your employee's usual wages are less than the subsidy, you must pay them their usual wages. Any difference should be used for the wages of other affected staff.
If there are no other employees to use the subsidy for, then the remaining amount should be paid back.
If you're self-employed, the income you regularly draw from your business may be less than the amount you receive for the Wage Subsidy Extension. In this case, the remaining amount should be paid back.
While the last possible date to apply is 1 September, we recommend you don’t leave it that late, as you would need to calculate the revenue drop in August in one day and this may be difficult.
Our considerations above are based on information available to date as at 5 June 2020. More information about criteria specifics will be available by 10 June 2020 when applications open. Find out more here.
How many hours do I need my employees to work? The full-time subsidy at (for example) $25 per hour will only cover 23.4 hours of working time, if possible, the hours of work your team are working should be aligned to the volume of work that you have available.