Last Friday 27 March, the Government announced further amendments to the Wage Subsidy Scheme, effective from 4pm that day. In particular, a number of modifications were made to the declaration required to be made by anyone applying for the wage subsidy including employers.
These modifications are:
Passing on the wage subsidy to employees
Retention of employees for the period of the subsidy
Accordingly, employers who applied for the wage subsidy after 4pm on 27 March 2020, are unable to make employees redundant for the period they are in receipt of the wage subsidy.
The purpose of these modifications is to ensure that the wage subsidy is passed on to employees and to keep employees and employers connected during the period of the lockdown. The Government has advised that they will be publishing a list of employers who are in receipt of the subsidy to assist with compliance.
Breach of declaration and repayment of salary
Whilst the wage subsidy scheme is a “high-trust” model, recipients of the wage subsidy may be subject to civil proceedings or prosecution if they provide false or misleading information, fail to meet any of the obligations regarding how the subsidy is to be used or receive any subsidy they were not entitled to receive.
Further, the declaration requires the wage subsidy to be repaid (in whole or in part) if the recipient:
Accordingly, we advise employers to ensure that they fully understand and are able to comply with the obligations required by the wage subsidy scheme, particularly those who applied after 4pm on 27 March 2020.
For more information on COVID-19 and its impact on your organisation, please contact our Employment Team (Troy Wano, Rebecca Eaton and Rochelle Farmer) on 06 768 3710 or 06 768 3716.