Raise the Bar: Everything you need to know about the wage subsidy

Right now low waged and insecure workers are feeling the economic brunt of the looming #Covid19 Recession. In response legal advocate Toby Cooper* and hospitality and worker’s rights advocate Chloe Ann-King, are putting together a series of legal blogs about your employment rights:

In this legal blog we outline some of the employer obligations in relation to the COVID-19 Wage Subsidy Scheme and provide an update on the latest advice and proposed changes to the Scheme as of Friday 27 March 2020:

All over Aotearoa, employers have fired workers’ at will, proposed redundancies, or forced employee’s to take annual leave during the lockdown which is causing serious economic hardship for many workers. Newsflash: Your employer can’t just fire you or make you redundant during this time! They MUST exhaust all avenues such as applying for the COVID-19 Wage Subsidy Scheme before making you redundant or firing you. If  your employer does not exhaust all avenues, you are likely in a good position to file with the Employment Relations Authority and bring a Personal Grievance proceedings against your employer for unfair dismissal and unfair disadvantage.

Your employer CANNOT force you to use up your annual leave / 8% holiday pay instead of paying you the wage subsidy. If they do this, they are breaching the Holidays Act 2003 and your basic employment entitlements. Employment law advocate Ashleigh Fechney told RNZ:

‘Absolutely not. Annual leave has to be taken by agreement. She said some contracts may contain clauses which say people can be asked to go on leave if they have large balances, but this also has to be done with reasonable warning and some discussion.’

Your employer must also make reasonable endeavours to keep paying you, including negotiating in good faith if they can only pay 80% of your wages. 80% of your normal wages is the lowest amount they should be paying you. They are obligated to pay you 100% of your wages if they are able to do so. 

Whatever your normal wages, you ought to be receiving at least the full value of the wage subsidy. 

The subsidy is $585.80 per week for a full time employee (20 hrs or more) or $350.00 per week for a part time employee (less than 20 hrs). Employers will receive a payment of $7,029.60 for a full time employee and $4,200 for a part time employee. This will be paid to employers in a single lump sum and should be passed onto their employees after tax is deducted, preferably as a single lump sum although could be distributed equally over the intended 12 week period.

At Raise the Bar, we are getting countless reports of employer’s withholding all or some of the wage subsidy which breaches the declaration they agreed to when they applied for the subsidy. If your employer is doing this, they open themselves up to the risk of prosecution for fraud. They would also likely have breached their legal duty of good faith. Employees could have a claim for arrears of wages as per the Employment Relations Act 2000. Please email us at raisethebarcampaign@gmail.com if you’d like us to report your employer on your behalf.

Now, onto the updates about the wage subsidy following the Friday 27 March 2020 Prime Ministerial Press Conference: 

– The 14-day self-isolation sick leave scheme is being folded into the Wage Subsidy scheme to prevent employers from double dipping.

– A separate sick leave provision scheme will be set up soon for essential workers who cannot work, especially those workers over 70 or who have health conditions. The Government has expressed that these workers should not be expected to leave their homes for work during the lockdown. 

– Employees ought to be receiving at least 80% of their normal wages. However, all workers must receive AT LEAST the full value of the subsidy from their employer.

– The Government has confirmed that employees should not be compelled to use their leave instead of using the subsidy.

– Employers cannot fire or make redundant any employees while they are receiving the scheme.

– Employers’ names who are receiving the Scheme will soon be made public.

– The Government wants to hear from anyone who believes their employer is receiving the Wage Subsidy but not passing this on to their staff. 

-Work and Income has also recently advised that employers can apply for their casual workers to receive the wage subsidy. 


If you would like further support please get in touch with Raise the Bar:

E: raisethebarcampaign@gmail.com

FB: @raisethebarnz and we have also set up a hospo support group on FB, Aotearoa Hospitality Workers’ Helping Each Other Through Covid-19

*Chloe Ann-King, is a noted workers and welfare rights advocate and activist who founded Raise the Bar: your hospo campaign, in 2016. She has also written extensively about the impacts of low waged and precarious work in Aotearoa and around the world. Previously she volunteered extensively with Unions in both Aotearoa and Australia and last year she studied for a Post Grad Cert in Human Rights, which expanded her legal knowledge.

*Toby Cooper is legally trained and has previously worked as an employment lawyer in one of Aotearoa’s top boutique employment firms. He’s currently volunteering at Community Law and with Raise the Bar, and has a passion for supporting low waged workers by empowering them with legal knowledge and understanding.

If you would like to support Raise the Bar, you can donate via:

  • PayPal: king.chloe@gmail.com (we are working on setting up a Raise the Bar PayPal asap)
  • Patreon
  • Direct Bank Account: MISS C A KING, 12-3040-0580277-01

All donations go towards maintaining Raise the Bar, we are also hoping to set up funds for hospo workers who need a koha for food, rent and other necessities.

Please get in touch for specific advice.


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