JobKeeper - what it means for your business.
The Federal Government’s JobKeeker initiative will help thousands of small, medium and micro businesses, particularly those in mandatory shutdown (or as the Government prefers to say, ‘hibernation’) to keep around 6 million Australians employed and the economy ticking over.
Frankly, it is the rescue package we’ve been waiting for. And it’s $130b of government cash that will go a long way towards keeping spirits up over the next six months as Australia battles this continual health crisis for the foreseeable future. It will be of great comfort to businesses concerned about how to stay afloat, and it will keep as many people as possible away from the Centrelink queues.
Although more details are yet to come, we working through the fine points and contacting clients as soon as possible to help them to understand how to apply for this payment on behalf of employees.
By ATB Partners
The basic premise is this: For the next six months, the federal government will pay eligible employers $1,500 per fortnight for each eligible worker, about 70% of the national median wage.
To receive a payment, both the employer and the employee must meet eligibility criteria, which is as follows:
Eligible employers
- Businesses (including companies, partnerships, trusts and sole traders), not-for-profits and charities:
- With a turnover of less than $1bn that have lost 30% or more of their revenue compared to a comparable period a year ago.
- With a turnover of $1bn or more and with at least a 50% reduction in revenue compared to a comparable period a year ago.
- The big banks subject to the banking levy are not eligible.
Eligible employees
- Were employed by an eligible employer at 1 March 2020.
- Can be sole traders, full-time, part-time, or long-term casuals employed on a regular basis for longer than 12 months as at 1 March 2020.
- Are at least 16 years of age.
- Are an Australian citizen, the holder of a permanent visa, a protected special category visa, a non-protected special category visa who has been residing continually in Australia for 10 years or more, or a New Zealander on a special category (subclass 444) visa.
The scheme’s eligibility criteria may yet be expanded, but we are staying abreast of all developments and will contact clients whose employees may be affected.
Employers must continue to pay the superannuation guarantee on regular wages but it is up to the employer whether they pay superannuation on additional job keeper payments.
How the scheme works
- Employers will be paid $1,500 per fortnight. While the money will not start to come through to bank accounts until May, it will be backdated to 31 March 2020. Employers will top up the payment for employees who earn more.
- If an employee ordinarily receives less than $1,500 in income per fortnight before tax, their employer must pay them, at a minimum, $1,500 per fortnight, before tax. It is therefore possible for a long-term casual or part-time worker to receive more than their ordinary pay.
- Employers will pay employees as usual and payments will be made to the employer monthly in arrears by the Australian Tax Office.
- If an employee was employed on 1 March 2020, subsequently ceased employment with their employer, and then has been re-engaged by the same eligible employer, the employee will also receive, at a minimum, $1,500 per fortnight, before tax.
What about superannuation?
Employers must continue to pay the superannuation guarantee on regular wages but it is up to the employer whether they pay superannuation on additional job keeper payments.
Rules for employees
- Employees with more than one job, can only receive the JobKeeper payment from one employer. Those receiving the JobKeeper payment are not eligible for any other payments (such as the jobseeker allowance, or the coronavirus supplement).
- A person receiving the JobKeeper payment cannot also receive the JobSeeker payment (formerly Newstart). People who have already applied for JobSeeker can withdraw and shift to job keeper payments if they are re-engaged by their employer.
Getting help
That’s it in a nutshell. If you are a client of ATB Partners, you can expect to hear from us about this, and other government assistance that you can apply for.
If you aren’t a client, and you’d like more information, you can contact us on our new temporary phone number 02 8660 0993, or alternatively, via the website contact page.
Our team is working remotely. We have all the technology and systems in place to help clients at this time.
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