Employers

Essential businesses

Essential businesses, and those that support them, will continue to provide the necessities of life for everyone in New Zealand.

This means food, medicine, healthcare, energy, fuel, waste-removal, internet and financial support will continue to be available.

What are essential businesses?

These businesses will continue working but will put in place alternative ways of working to keep employees safe, including shift-based working, staggered meal breaks, flexible leave arrangements and physical distancing. They must have health measures and contact tracing in place.

Physical distancing means staff and the public stay 2 metres apart, and hand hygiene and cleaning must be maintained. Keeping full details of customers or guests, and keeping people away if they are sick is required.

If you have any queries about what an essential service is and if it applies to your business sector, you can get in touch with general enquiries at 0800 22 66 57 or email essential@mbie.govt.nz for advice regarding your specific business.

We will publish more specific information for each sector shortly.

Primary Industries Businesses Register for Safe Practice

If you provide an essential service within the primary industries, including critical support goods and services, you are required to register with the Ministry for Primary Industries and answer 11 questions about how you intend to stop any spread of COVID-19.

Businesses with 5 or fewer people (including the owner) working at each business site that can achieve physical distancing are exempt.

Primary sector businesses can contact MPI for more information by calling 0800 00 83 33 or emailing info@mpi.govt.nz.

Visit MPI for more information(external link)

Non-essential businesses

Non-essential businesses must now close, unless they able to operate from home.

All bars, restaurants, cafes including takeaway services, gyms, cinemas, pools, museums, libraries, playgrounds and any other place where the public congregate must close their face-to-face function.

We need your support to protect New Zealand and eradicate COVID-19.

Enforcement measures may be used to ensure everyone acts together, now.

Employers and staff working together

Employers and employees need to work together to slow the spread of COVID-19, protect New Zealand and keep each other safe.

This means that normal obligations to keep in regular contact and to act in good faith are more important than ever. This is how employers and employees can be kind to one another.

Regular employment law applies to all employment relationships – regardless of the circumstances that we find ourselves in. This includes anything that has been agreed to in an employment agreement.

Employment guidance is available for COVID-19-related matters, including pay and leave entitlements, the minimum wage, and modifying and terminating employment agreements,

Guidance for employers and employees(external link)

Employer Wage Subsidy Scheme

The Employer Wage Subsidy Scheme:

  • supports employers adversely affected by COVID-19, so that you can continue to pay your employees, and
  • supports workers to ensure they continue to receive an income, even if they are unable to work.

New Zealand employers whose businesses have been affected by COVID-19 are eligible to apply. This includes:

  • registered charities
  • NGOs
  • the self-employed and sole traders
  • contractors
  • registered charities
  • incorporated societies, and
  • post-settlement governance entities.

It is also available to employers who recently let employees go because of COVID-19, provided they re-hire those employees.

To qualify:

  • the business is registered and operating in New Zealand
  • employees are legally working in New Zealand
  • the business has experienced a minimum 30% decline in actual or predicted revenue over the period of a month when compared with the same month last year, and that decline is related to COVID-19. There are special rules for new businesses and high-growth firms
  • the business has taken active steps to mitigate the impact of COVID-19
  • the business must retain covered employees in employment for the period of the subsidy.

The COVID-19 Wage Subsidy will be paid at a flat rate of:

  • $585.80 for people working 20 hours or more per week
  • $350.00 for people working less than 20 hours per week.

Employers must make best endeavours to pay employees 80% of their normal income. Where that is not possible – in particular where a business has no activity whatsoever due to the shutdown and workers are not working any hours – employers must pass on at least the whole value of the wage subsidy to each affected worker. If a person’s income is normally less than the subsidy, they can be paid that normal salary.

The subsidy is paid as a lump sum to the employer to pass on to employees and covers 12 weeks per employee.

The wage subsidy is a Government payment to help employers pay wages. It does not change any other employment law obligations, meaning employees must be paid appropriately under their employment agreements for the hours they work during the lockdown.

Read more information, including how to apply, on Work and Income(external link)

Updates to the Wage Subsidy Scheme

6 April 2020: Search function now available to find employers who have received payments under the Wage Subsidy scheme(external link)  

27 March 2020: Government modified scheme to better support workers not able to work during Level 4(external link)

24 March 2020: the Government announced the removal of the $150,000 cap(external link)

Redundancy support

Businesses who are considering laying off workers should consider applying for the Wage Subsidy Scheme.

Details about the Wage Subsidy Scheme(external link)

Essential Workers Leave Payment Scheme

If your business needs help to pay essential workers who need to take leave due to COVID-19 Public Health guidance it could be eligible for the Essential Workers Leave Payment Scheme. This scheme subsidises eligible businesses, and allows them to pay workers who need to take because Ministry of Health guidelines recommend they stay at home, and they can't work from home.

The scheme offers the same rates as the Wage Subsidy Scheme of $585.80 per week full-time workers and $350.00 per week for part-time workers.

Essential Workers Leave Payment Scheme(external link)

Business Finance Guarantee Scheme

Small and medium-sized businesses may be eligible for the Business Finance Guarantee Scheme to protect jobs and support the economy. The Crown in partnership with participating approved banks will support targeted new loans (including increases to existing limits) to eligible businesses, as a response to difficulties caused by COVID-19.

Under the scheme, businesses with annual revenue between $250,000 and $80 million can apply to their banks for loans up to $500,000, for up to 3 years. The scheme will offer a total of $6.25 billion in loans to New Zealand businesses.

Banks will decide whether financing can be supported under the Scheme through its normal credit assessment process. Banks will also take into account a business' circumstances due to Covid-19.

The Government is guaranteeing 80% of the risk, while the banks are covering the remaining 20%. Banks will follow a normal lending process when they make the lending decisions. Further details can be found on the banks’ websites. 

Announcement of the opening of the scheme(external link)

Business.govt.nz information about the Business Finance Guarantee Scheme(external link)

Business cash flow and tax measures

Measures to support business cash flow and tax measures include: 

  • increasing the provisional tax threshold from $2,500 to $5,000 from 2020/2021 
  • increasing the small asset depreciation threshold from $500 to $1,000 — and to $5,000 for the 2020/21 tax year 
  • allowing depreciation on commercial and industrial buildings from 2020/2021 
  • removing the hours test from the In-Work Tax Credit (IWTC) from 1 July 2020.

Read more information about COVID-19 tax relief measures at ird.govt.nz(external link) 

Support for Māori communities and businesses

Māori communities and businesses can access help tailored to meet the specific needs of Māori in the face of COVID-19. These include:

  • a Whānau Māori Community and Mārae package reprioritising $10 million from the Māori Development vote to support community outreach
  • Māori Health and Whānau Ora response with $30 million targeted directly to Māori Health services and an extra $15 million to Whānau Ora commissioning agencies
  • supporting Māori Businesses and engaging with Māori with $1 million of funding to enable a needs assessment for Māori businesses, and $470,000 to Te Arawhiti to engage and work with iwi on their COVID-19 pandemic response plans.

Read the Government’s media release (beehive.govt.nz)(external link)

Additional resources

Business information relating to COVID-19, how it may affect your business and how you can stay up to date on the business.govt.nz website(external link)

Information about workplace responses to COVID-19 at the employment.govt.nz website(external link)

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