[updated 14th April 2020]
COVID-19 Employer Alert: New Job-Keeper Subsidy
As part of the Federal Government’s “Economic Response to the Coronavirus”, a new JobKeeper Payment was announced. Businesses impacted by the Coronavirus will be able to access the JobKeeper subsidy to continue paying their employees.
On 8 April 2020, Parliament passed the Coronavirus Economic Response Package Bill 2020. This new legislation amends the Fair Work Act and enacts the JobKeeper scheme.
The JobKeeper Payment will support 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.
JobKeeper Payment - Key Facts for Employers:
Affected employers will be able to claim a fortnightly payment from the government of $1,500 per eligible employee from 30th March 2020, for a maximum period of 6 months.
Payments will be made to the employer monthly in arrears by the ATO. The idea is that the employer pays their employees the $1,500 flat rate, provided they were on the books as of 1st March 2020, and the Government will reimburse those businesses.
Employers and sole traders will be eligible for the subsidy if: - their business has a turnover of less than $1 billion and their turnover will be reduced by more than 30% relative to a comparable period a year ago (of at least a month); or - their business has a turnover of $1 billion or more and their turnover will be reduced by more than 50% relative to a comparable period a year ago (of at least a month); and - the business is not subject to the Major Bank Levy.
Not-ForProfits (excluding charities) will be eligible for the JobKeeper Payment if, at the time of applying: - they have an aggregated turnover of less than $1 billion and they estimate their GST turnover has fallen or will likely fall by 30% or more; or - they have an aggregated turnover of $1 billion or more and they estimate their GST turnover has fallen or will fall by 50% or more.
Charities registered with the Australian Charities and Not-for-profits Commission will be eligible for the subsidy if they estimate their turnover has or will likely fall by 15% or more, relative to a comparable period. This lower turnover decline test does not apply to universities and non-government schools that are registered charities.
Eligible employers who have stood down their employees before the commencement of this scheme will be able to participate. Employees that are re-engaged by a business that was their employer on 1st March 2020 will also be eligible.
Businesses will be able to register their interest in participating in the Jobkeeper Payment from 30th March 2020 on the ATO website.
The first payments will be received by employers in the first week of May 2020.
Eligible employees include full-time, part-time, long-term casuals (employed on a regular basis for longer than 12 months as of 1st March 2020), and stood down employees.
Eligible employees can only receive the JobKeeper Payment from one employer.
Eligible employees must be at least 16 years of age and be either an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a New Zealander on a 444 Visa.
Employees cannot claim for both JobSeeker and JobKeeper payments. Employees who have already applied for JobSeeker can speak with their employer about being moved across to the new JobKeeper payment.
Employer Obligations to Receive the JobKeeper Payment:
When registering an intention to apply on the ATO website, employers must assess that they have or will experience the required turnover decline.
Employers must provide information to the ATO on eligible employees, including the number of eligible employees engaged as of 1st March 2020 and those currently employed by the business (including those stood down or rehired). Where possible, the ATO will use Single Touch Payroll data to gather these details.
Employers must continue to provide information to the ATO on a monthly basis, including the number of eligible employees employed by the business.
Employers must ensure that each eligible employee receives at least $1,500 per fortnight (before tax).
It will be up to the employer to decide if they want to pay superannuation on any additional wage paid because of the JobKeeper Payment.
Employers must notify all eligible employees that they are receiving the JobKeeper Payment.
What if my employee was recently made redundant?
There are various scenarios in which you may be able to rehire former employees and be eligible to receive the new JobKeeper subsidy. To discuss the specific needs of your business or organisation, please contact us today.
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.
Update: On 1st April 2020, Fairwork proposed new pandemic leave and award flexibility during coronavirus.
WorkPlacePLUS remains open for business during the COVID-19 lockdown period. 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.