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The leave support scheme covers those who cannot work because of Covid-19 (Photo: Getty Images)
The leave support scheme covers those who cannot work because of Covid-19 (Photo: Getty Images)

BusinessAugust 19, 2020

Everything you need to know about the Covid-19 Leave Support Scheme

The leave support scheme covers those who cannot work because of Covid-19 (Photo: Getty Images)
The leave support scheme covers those who cannot work because of Covid-19 (Photo: Getty Images)

What happens to your job and income if you need to self-isolate? We take a look at the scheme that is designed to keep you in pay even when you can’t work.

With Covid-19 once again present in the community, hordes of people have been showing up at testing centres across Auckland, often queuing for over five hours to check if they have the virus.

However, because someone testing positive for Covid-19 will mean they must self-isolate at home for at least 14 days, many other people have been reluctant to get the test, afraid that if they are found positive and don’t have sick leave, they might go without pay for two weeks or even lose their jobs for good.

The trepidation is perfectly understandable: even a few days without income would be devastating to most people who have families to support, groceries to buy and bills and rent to pay. So to appease fears and encourage symptomatic people to get the test, the government has provided the Covid-19 Leave Support Scheme – a payment for people who have been instructed by the Ministry of Health to self-isolate yet cannot work from home.

Originally available for essential businesses only, it is now open to all employers or sole traders to continue paying their employees who can’t work because of Covid-19.

Who is eligible?

Apart from those who work for state sector organisations, any worker who has been advised by the Ministry of Health to self-isolate yet is unable to work from home is eligible to receive the leave support payment.

The MOH may instruct a person to self-isolate at home either because they are at a higher risk of Covid-19, have come into contact with someone with Covid-19, have actually tested positive for Covid-19, or have household members who are at higher risk from the virus.

An employer must have a conversation with their employees and get their consent before applying for the scheme.

Prior to August 21, the leave support scheme came with a caveat: any employer who wanted to apply for their workers needed to pass a revenue test showing their business suffered an actual or predicted 30% decline in revenue over a month because of the impacts of Covid-19.

However, in response to the current outbreak of Covid-19 in Auckland, the government has removed the criteria for any business that applies after 1pm on August 21.

How do I apply?

It works in a similar way to the Covid-19 wage subsidy. An employer gets the consent of the relevant employees and applies via the Work and Income website, declaring that they meet all the criteria and providing various business and employee details: IRD numbers, dates of birth, business numbers.

Many people are reluctant to get tested because of how self-isolation might affect their income (Photo: RNZ /Dom Thomas)

What if I, or my employees, are already receiving the wage subsidy?

The leave support scheme works alongside the Covid-19 wage subsidy scheme. It’s one or the other. Employees who are receiving the wage subsidy can’t also receive the leave support scheme at the same time.

How much do employees get?

Employees get exactly the same amount as they would through the wage subsidy: full time workers working 20 hours or more per week will get $585.80 gross per week, while part-timers working less that 20 hours per week will get $350.00 gross.

The scheme is paid as a lump sum and covers four weeks per employee from the date an employer submits their application. As in the wage subsidy, employers are expected to pay employees in accordance with their employment agreement, or, if they can’t do that, then they “should try their hardest” to pay them at least 80% of their usual wages, using the leave support payment to subsidise a portion of it.

How long does it take to get the money?

Because some companies are larger than others and MSD needs to check every employee’s information with the IRD, the payment timeframes vary.

However, MSD says it aims to make the payments as quickly as it can.

What if I need to reapply for the scheme?

If the Ministry of Health has advised that an employee is still unable to return to work after the self-isolation period, an employer can reapply for the leave support scheme. This must be done in the fourth week of the payment period for that employee.

Can an employee apply themselves?

No. Unless you are a sole trader or an independent contractor, an employer must apply on behalf of employees.

So if the Ministry of Health has advised you to self-isolate at home, have a conversation with your employer about the options available and whether they need to apply for leave support.

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