With talk of the economic impact of COVID-19 being comparable to the Great Depression, it’s no wonder that you and your staff are probably worried about the future.
A few weeks ago, you might have been facing the difficult decision to make staff redundant, to stand them down or wondering what leave staff were entitled to. If you’re still grappling with these issues, check out our article here for a breakdown of what you need to know.
Recently, the government has thrown Australian businesses and employees a lifeline in the form of the JobKeeper Payment. The aims of this scheme are to keep unemployment down, keep staff connected to their workplaces, and give businesses a shot at survival with the hope of minimising disruption to the economy.
The JobKeeper Payment is a game changer for businesses, so it’s really important to check if your business might be eligible.
What Is The JobKeeper Payment?
The JobKeeper Payment is a payment for some businesses and not-for-profits who have suffered a financial loss due to COVID-19. It is administered by the ATO and will last from 30 March 2020 to 27 September 2020.
Firstly your business has to register for the payment. Then, if you are eligible, the ATO will give your business a JobKeeper payment for you to pay to each eligible staff member you have.
What Businesses/Not-For-Profits Are Eligible For JobKeeper?
To be eligible, your business must have carried out its activities in Australia as of 1 March 2020, and suffered a specific decline in turnover. Not-for-profits and sole traders can be eligible, too.
Here’s a breakdown of the eligibility requirements.
|Type of Business||Required Decline in Turnover|
|Businesses with aggregate turnover of less than $1 billion||30% or more|
|Businesses with aggregate turnover of more than $1 billion||50% or more|
|Charity registered with the ACNC (other than universities and schools)||15% or more|
This decline is measured by looking at the turnover you made in the relevant time period in which you were affected. The relevant time period is according to your BAS statement and could be for a month or a quarter compared to the turnover you made in the same time period a year ago.
I Run A High Growth Company And A Comparison With 2019 Doesn’t Make Sense. Am I Eligible?
Too right! For startups that have experienced recent growth, comparing what you made in March 2020 to what you made in March 2019 is an illogical way to measure how much your business has suffered or is predicted to suffer.
If the whole point of this policy is to keep and save jobs, a comparison with a year ago doesn’t make sense, given that you might’ve created a whole lot of jobs in the last 12 months.
Additionally, many businesses were not in existence a year ago, may have changed their business structure, or may have experienced variables out of their control. For these types of businesses, making a 12 month comparison also doesn’t make much sense.
So, are you still eligible? To find out more, check out our article on the alternative tests for JobKeeper eligibility.
How Much Do I Get?
Under the JobKeeper payment, you can receive $1500 per eligible employee per fortnight.
An eligible employee means someone who satisfies all of the following conditions as of 1 March 2020:
- Is 16 years or older
- Is an Australian resident for tax purposes, an Australian citizen, a holder of a permanent visa, or a holder of a Special Category (Subclass 444) Visa
- Was an employee of your business on 1 March 2020
The employee needs to be a permanent staff member (full time or part time) or a long-term casual employee. A long-term casual employee is someone who was employed on a ‘regular and systematic basis’ for a minimum period of 12 months.
Got A Staff Member Who Works Two Jobs?
Staff can’t be paid twice for the JobKeeper payment.
This means you are not eligible for the JobKeeper payment for any staff member who is already eligible for the payment from another business they work for.
Your staff can choose who they receive the JobKeeper payment from, unless they are both a casual and a permanent employee. In this case, the staff member has to nominate the permanent position for their JobKeeper payment.
What If I Stood Down My Staff Or Made Them Redundant Before I Knew About JobKeeper?
If your staff were employed with you as of 1 March 2020, and you have since let them go or made them redundant, you have the option to rehire your staff and provide them with the JobKeeper payment.
You can also access the JobKeeper payment for staff who were stood down after 1 March 2020.
Is There Other Support Available For My Business?
There is other support for businesses available in the form of payments from $20,000 to $100,000 for eligible businesses. These subsidies are to assist businesses with their operational needs and to further help businesses keep staff.
According to the Treasury, other supports include increasing the instant asset write-off and backing business investment.
How Do I Apply For JobKeeper? What Do I Need To Do If I’m Successful?
You can apply now!
To apply, check if you are eligible on the ATO website, and follow their instructions regarding the application process. Be aware of deadlines: an extension of time has been granted to apply for the first period of JobKeeper payments in April and May, and the deadline is now 31 May 2020.
If your business is eligible for the JobKeeper payment, you need to give information to the ATO on your eligible employees. You will need to continue to do this on a monthly basis, and give updates if anything changes.
Next, you need to inform all eligible employees that they are receiving the JobKeeper payment. Regardless of what your employee’s normal wage is – even if it is normally less than $1500 – you need to effect payment of $1500 to each eligible staff member as a minimum.
If you need help understanding how the JobKeeper payment might apply to your business, or have any other employment law questions, feel free to reach out to us at Sprintlaw. We can arrange a consult with an experienced employment lawyer to discuss your next steps.
Also, head over to our Coronavirus resource hub for more articles about managing your business through Coronavirus, as well as to see the discounted support packages we’re offering to affected businesses.
Editor’s note: The information in this article is correct as of 27 April 2020. With the legal landscape surrounding COVID-19 changing rapidly, it’s important you keep on top of any new developments and speak to a lawyer if you’re uncertain about your specific situation.
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