Dáil Éireann Debate, Tuesday - 16 June 2020
109. Deputy Charlie McConalogue asked the Minister for Finance if the situation in respect of the temporary wage subsidy scheme as outlined in correspondence (details supplied) will be clarified; and if he will make a statement on the matter. [11402/20]
View answerSection 28 of the Emergency Measures in the Public Interest (Covid-19) Act 2020 underpins the Temporary Wage Subsidy Scheme (TWSS). It makes provision for the Minister for Finance to determine the amount of the temporary wage subsidy, with the consent of the Minister for Employment Affairs and Social Protection, given with the concurrence of the Minister for Public Expenditure and Reform, and different amounts of temporary wage subsidies may be so determined in relation to different classes of employee.
On 15 April 2020, I announced further updates to the TWSS. Included in the updates were measures to increase the wage subsidy for certain lower paid employees. In effect, for those employees with previous net pay of less than €586 per week, the amount of the temporary wage subsidy shall not exceed €410 per week in accordance with the following principles:
- an 85% subsidy shall be payable in the case of employees whose average net weekly pay does not exceed €412; and
- a flat rate subsidy of up to €350 shall be payable in the case of employees whose average net weekly pay is more than €412 but not more than €500.
The amount of the wage subsidy for each employee is calculated based on the Average Revenue Net Weekly Pay (ARNWP) reported by the employer to Revenue for January and February 2020. In the case the Deputy refers to, where an eligible employee returns to work under the wage subsidy scheme and the employee’s ARNWP is between €412 and €500, a flat rate subsidy of up to €350 shall be payable. However, tapering or restriction of the subsidy shall apply to cases where the gross pay paid by the employer, and reported on their payroll submission, plus the wage subsidy amount exceeds the average revenue net weekly pay. Thus, whether the employer has the subsidy tapered to zero is dependent on the level of gross pay paid in excess of the ARNWP.
By way of an example, where an employee has an average revenue net weekly pay of €480 the full wage subsidy of €350 is payable up to a point where the employer tops up gross pay to €130, in effect staying within the ARNWP limit. If the employer pays gross pay of €230 in a particular week, then the subsidy amount for that week is reduced proportionately to €250 to ensure the ARNWP does not exceed €480. However if the employer paid the employee €500 gross in one week, the ARNWP limit has been exceeded and thus, no subsidy is due.
