This article was updated 11th August 2020. Read The end of JobKeeper, posted 25th March 2021 >
On 8 April 2020, Parliament passed the Coronavirus Economic Response Package Bill 2020. This new legislation amended the Fair Work Act and enacted the JobKeeper Payment scheme.
The JobKeeper Payment scheme is a temporary subsidy for businesses significantly affected by COVID-19.
Eligible employers, sole traders and other entities can apply to receive $1,500 per eligible employee per fortnight. This allows businesses impacted by COVID-19 to continue paying their employees.
In some cases, the JobKeeper Payment scheme supports employers to maintain their connection to their employees during a shutdown or lockdown, enabling businesses to reactivate their operations after the COVID-19 crisis, without having to rehire staff.
Originally, the JobKeeper Payment was due to run until 27 September 2020, however, it will now continue to be available for eligible businesses (including the self-employed) and not-for-profits until 28 March 2021.
This extension is broken down into two periods.
From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:
$1,200 per fortnight for all eligible employees who were working in the business or notfor-profit for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average.
$750 per fortnight for other eligible employees and business participants.
From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:
$1,000 per fortnight for all eligible employees who were working in the business or notfor-profit for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for business participants who were actively engaged in the business for 20 hours or more per week on average.
$650 per fortnight for other eligible employees and business participants. Businesses and not-for-profits will be required to nominate which payment rate they are claiming for each of their eligible employees (or business participants).
To be eligible for JobKeeper payments under the extension, businesses have to see a reduction in turnover of 30% or 50% (depending on their annual GST turnover) and a reduction of 15% for charities.
Employers will need to ensure they have met the decline in turnover test conditions in both the June 2020 and September 2020 quarters to be eligible for the JobKeeper 2.0 payment in the December 2020 quarter.
From 4 January 2021, businesses and not-for-profits will be required to reassess eligibility based on their turnover. They must demonstrate that they have met the decline in turnover test in the June 2020, September 2020 and December 2020 quarters to remain eligible for the upcoming JobKeeper 2.0 payment (4 January 2021 - 28 March 2021).
If a business or not-for-profit does not meet the additional turnover tests for the extension period, this does not affect their eligibility prior to 28 September 2020. The JobKeeper Payment will continue to remain open to new recipients, provided they meet the existing eligibility requirements and the additional turnover tests during the extension period.
For more information refer to the following links:
Employees are eligible in the extension period if they:
are currently employed by an eligible employer (including if you were stood down or rehired)
were for the eligible employer (or another entity in their wholly-owned group) either a full-time, part-time or fixed-term employee at 1 July 2020; or a long-term casual employee (employed on a regular and systematic basis for at least 12 months) as of 1 July 2020 and not a permanent employee of any other employer.
were aged 18 years or older on 1 July 2020 (if you were 16 or 17 you can also qualify if you are independent or not undertaking full-time study).
were either an Australian resident (within the meaning of the Social Security Act 1991); or an Australian resident for the purpose of the Income Tax Assessment Act 1936 and the holder of a Subclass 444 (Special Category) visa as at 1 July 2020.
were not in receipt of any of these payments during the JobKeeper fortnight: government parental leave or Dad and partner pay under the Paid Parental Leave Act 2010; or a payment in accordance with Australian worker compensation law for an individual's total incapacity for work.
Only one employer can claim the JobKeeper Payment in respect of an employee.
The self-employed will be eligible to receive the JobKeeper Payment where they meet the relevant turnover test, and are not a permanent employee of another employer.
Employees will continue to receive the JobKeeper Payment through their employer during the period of the extension if they and their employer are eligible and their employer is claiming the JobKeeper Payment.
Further information for employees can be found at https://www.ato.gov.au/general/jobkeeper-payment/employees/.
The Government also has a number of other livelihood support initiatives to help businesses, employers and employees stay afloat during the COVID-19 crisis. Please contact us for further details.
WorkPlacePLUS remains open for business during the COVID-19 pandemic. We are currently providing our clients with up-to-date best practice advice and support via phone, telehealth and teleconferencing.
For more information, please contact us today.