This week so far in context:
We have seen:
- The government unveil the Jobkeeper payment COVID-19 package essentially involving a $130 billion payment.
- Information start to be disseminated from various government websites providing details on this payment designed to help keep Australians in jobs and support businesses affected by the significant impact of COVID-19
- Confirmation that round 6 million workers will receive a fortnightly payment of $1,500 (before tax) through their employer.
The Jobkeeper payment is a significant step by the government and will ensure employers will remain connected to their workers. Legislation is expected to be passed in the next week or so to support this initiative.
These are the top questions our clients, both business owners and workers, have been asking us this week:
What is the Jobkeeper payment?
It is a wage subsidy available to eligible businesses impacted by COVID-19. It is designed to keep more Australians employment through the pandemic by providing businesses with financial support.
Essentially this means that many employers will now be able to retain employees they otherwise would have had to stand down or make redundant.
Which businesses can apply?
Businesses have to be an eligible employer and have eligible employees. To qualify the business is eligible if:
- their business has a turnover of less than $1 billion and their turnover has fallen by more than 30 per cent (of at least a month); or
- their business has a turnover of $1 billion or more and their turnover has fallen by more than 50 per cent (of at least a month); and
- the business is not subject to the Major Bank Levy.
Are sole traders and not-for-profit and charities also eligible?
Yes if they meet the above tests.
Which employees are eligible?
- are currently employed by the eligible employer;
- were employed by the employer at 1 March 2020 (including those stood down or subsequently re-hired after having been made redundant post 1 March 2020);
- are full-time, part-time, or long-term casuals (a casual 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, hold 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 Special Category (Subclass 444) Visa Holder; and
- are not receiving a JobKeeper Payment from another employer.
If approved, what is paid and to whom?
The employer will receive:
- A partial wage subsidy for those employees earning more than $1,500 (less tax) per fortnight; and
- A full wage subsidy for those earning less than $1,500 (less tax) per fortnight, including part-timers.
What about superannuation?
The employer’s contribution is unlikely to be legally required to pay higher superannuation contributions above the usual wage, but we await the legislation.
Can employees double-dip?
No, employees can either receive the Jobkeeper payment or the Jobseeker payment, not both.
What is the application process for business owners?
Business owners can register their interest with the ATO via ato.gov.au from 30 March to receive this subsidy. Next step is an online application nominating eligible employees.
When will payments be received, are they back-dated, and how long will they be paid for?
Business owners will receive their first payment in early May 2020, backdated to 1 March 2020. Ongoing payments will be paid monthly in arrears for a total period of 6 months.
Have questions about the JobKeeper payment from our COVID-19 Employment FAST FACTS?
If you are a business owner and are unsure as to how to best protect your business or what your responsibilities are in any given situation, please contact our office for further advice. We are offering a special discount for business owners during this time.