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COVID-19 - JobKeeper Payment Announced

31 March 2020

On Monday the Government announced a $130 billion subsidy program designed to help businesses affected by the Coronavirus to cover the costs of their employees’ wages.

Under the JobKeeper Payment, businesses impacted by the Coronavirus will be able to access a subsidy from the Government to continue paying their employees. Affected employers will be able to claim a fortnightly payment of $1,500 per eligible employee from 30 March 2020, for a maximum period of 6 months.

Eligible employers:

For businesses with turnover less than $1billion, turnover has to be reduced by more than 30 per cent. Businesses can assess this by looking at a comparable month from 2019. The employer must also have been in an employment relationship with eligible employees as at 1 March 2020 and confirm that each eligible employee is currently engaged in order to receive JobKeeper Payments. 

Not-for-profit entities and self-employed individuals are also eligible to apply for JobKeeper Payments.

Eligible employees are employees who:

  • Are currently employed (including those stood down or re-hired);
  • Were employed by the employer at 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 (or fall into one of the identified visa categories);
  • Are not in receipt of a JobKeeper Payment from another employer

If an employee receives a JobKeeper Payment, this may affect their eligibility for payments from Services Australia, as they must report their JobKeeper Payment as income.

How to apply:

Employers can register their interest in applying for the JobKeeper Payment HERE from 30 March 2020.

Businesses will need to provide information to the ATO on eligible employees. For most businesses, the ATO will use Single Touch Payroll data to pre-populate the employee details for the business.

The first payment will be received by employers from the ATO in the first week of May.  Payments will then be made to eligible employers on a monthly basis in arrears by the ATO.

Participating employers will be required to ensure eligible employees receive:

  • If the employee ordinarily receives less than $1,500 income per fortnight before tax, at a minimum $1,500 per fortnight, before tax.
  • Where an employee ordinarily receives $1,500 or more income per fortnight before tax, they will continue to receive their regular income according to their prevailing workplace arrangements, and the JobKeeper Payment will assist their employer by subsidising the all or part of the employee’s income.
  • If an employee has been stood down, their employer must pay them at a minimum $1,500 per fortnight before tax;
  • If an employee was employed on 1 March 2020, subsequently ceased employment with their employer and then has been re-engaged by the same employer, the employee must receive at a minimum $1,500 per fortnight before tax.

At this stage, it is proposed that it will be up to the employer if they wish to pay super guarantee on any additional wage paid because of the JobKeeper Payment. For example, if an employee’s fortnightly income was only $1,400, the employer may decide if they continue paying super guarantee only on $1,400/fortnight, or if they choose to pay super on the full $1,500/fortnight.

Employers will need to continue to provide information to the ATO on a monthly basis, including the number of eligible employees employed by the business.

Further information is available on the Treasury website and the Australian Business website.

Please note that the above information is from the announcement of the JobKeeper Payment measures. The measures won’t come into effect until legislation is enacted, and there may be changes to the measures before they become law.

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