Paying COVID-19 Subsidies in PaySauce

Situation 1

I’m receiving the COVID-19 Wage Subsidy to help me afford to pay my staff

Why:

to help you keep on and continue paying your people

When:

your business can’t run due to lockdowns
or
if your team can still work but your business is suffering financially

Rules:

• For each full-time employee (at least 20 hours a week), the employer receives a subsidy of $585.80/week.
• For each part-time employee (less than 20 hours per week), the employer receives a subsidy of $350.00/week.
• The employee then needs to be paid at least 80% of their normal pay.

How to pay:

This is paid as a lump sum from the government to the employer, covering 12 weeks per employee. During the subsidized period, payments to staff are treated as wages/salary (not an allowance or a leave payment) and are subject to the usual PAYE, KiwiSaver, Student Loan deductions etc.

Waged employees

If you can’t afford to pay 100% of an employee’s normal wage, calculate the relevant percentage (at least 80%) of their normal hours per week - i.e an employee who normally works 40 hours would receive 32 hours.

Pay those 32 hours at their normal rate and enter the remaining 20% (ie 8 hours) for the week as “leave without pay”. This means your employee gets the correct leave accrual for the week. If your employee requests it, the remaining 20% can be taken as paid leave.

You can use average weekly hours to calculate this if they work variable hours and don’t have a standard number of hours per week.

Salaried employees

Salaried staff automatically accrue the right amount of leave per week in PaySauce, so you won’t need to enter any leave without pay. Their hours (eg 80% of normal weekly hours) are entered at their standard rate. If your employee agrees, the remaining 20% can be taken as paid leave.

 

Situation 2

I’m receiving the COVID-19 Leave Payment while staff are away from work

Why:

to support employees who can’t work because of sickness or self-isolation

When:

staff are self-isolating because they’re sick with COVID-19
or
are caring for a dependent who’s sick with COVID-19
or
are required to self-isolate by the Ministry of Health and can’t work from home

Rules:

• This is available for 8 weeks from 17 March 2020. It covers full-time, part-time and casual employees, and contractors.

• Each full-time employee (at least 20 hours a week) receives support of $585.80/week.

• Each part-time employee (less than 20 hours a week) receives support of $350.00/week.

• People may be required to self-isolate more than once, so employers will be able to apply for this on an ‘as needed’ basis. If an employee needs this benefit for longer than two weeks, the employer needs to reapply every 14 days.

• Employees don’t have to use up their other paid leave entitlements before they can receive this payment.

How to pay:

The government transfers this money to you as the employer, and you pass it on in full as wages to your employee.

If the payment isn’t enough to get by, it could be topped up with sick leave or annual leave if necessary (as discussed and agreed with your employee).

To pay this in PaySauce, set up an allowance.

• In 1Employees, click on the employee’s 2name.

• Go to the 3Payments tab.

• Click on the 4+ button on the right of the screen.

• In the 5New Allowance window, Select 6Fixed Amount in the “Rule” dropdown list and give it a title, ie “Isolation Leave Payment”. This will be taxable and included in KiwiSaver calculations.

• Set the 7Frequency to regular and the 8Amount will be either $585.80 (if the person works 20 hours or more per week) or $350.00 (if the person works less than 20 hours per week).

• Click “Ok” to close the Allowance window, then click “Ok” again to close the Payments window.

This allowance will now appear in the employee’s pay card for that pay period.

 

These guidelines are based on the info we currently have from MSD, and these could still change. We’re keeping an eye on them and will update if we need to, and you can see the latest here.