Legislation to establish the Federal Government’s JobKeeper scheme passed unamended through both houses of Parliament late yesterday (8 April) and is now awaiting Royal Assent. This legislation provides access for up to 6 months for eligible businesses to a fortnightly $1500 (before tax) subsidy per eligible employee from 30 March 2020.
Employers will be eligible for the subsidy if:
• their business has an annual turnover of less than $1 billion and they estimate their turnover
• has or will likely fall by 30 per cent or more; or
• their business has an annual turnover of $1 billion or more (or is part of a consolidated group
• for income tax purposes with turnover of $1 billion or more) and they estimate their turnover has or will likely fall by 50 per cent or more; and
• their business is not subject to the Major Bank Levy.
Sole traders will be eligible to receive the JobKeeper Payment where they meet the relevant turnover test above. Registered charities and Not-For-Profits will be eligible for the subsidy if they estimate their turnover has fallen, or will likely fall, by 15 per cent or more relative to a comparable period (eg. April 2020 v April 2019).
Eligible employees are employees who:
• are currently employed by the eligible employer (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 and systemic
• basis for longer than 12 months as at 1 March 2020);
• are at least 16 years of age at 1 March 2020;
• are an Australian citizen, the holder of a permanent visa, or a Special Category (Subclass 444)
• Visa Holder at 1 March 2020;
• were a resident for Australian tax purposes on 1 March 2020; and
• are not in receipt of a JobKeeper Payment from another employer.
Employers seeking the subsidy are required to register with the ATO.
The legislation also introduces temporary changes to the Fair Work Act 2009 which will allow employers in receipt of the Jobseeker subsidy to exercise significant new powers to:
• stand down their employees, including a reduction of weekly hours
• vary an employee’s work duties
• change an employee’s place of work.
These powers can override Modern Awards and Enterprise Agreement but are subject to a number of safeguards, including prior consultation in the case of varying work duties or work location. There are also protections around accrual of entitlements to make sure employees whose work is varied/paused under the new amendments are not disadvantaged.
Disputes about the operation of these powers will be arbitrated by the Fair Work Commission.
While these new powers will be welcomed by many employers struggling in the current economic climate, until Treasury issues the necessary JobSeeker eligibility Rules (and Royal Assent is granted), it is unclear when they will be available.
We will provide a further update once the full details of the new scheme are available. Please contact Andrew Maher on 0403 399237 if you have any queries.