note: the following blog discusses the now-expired JobKeeper legislation. This blog is out of date.
Jobkeeper Payment to Be Extended
The Morrison Government has recently announced that it will extend the JobKeeper scheme after the current JobKeeper legislation ends on 27 September 2020. “JobKeeper 2.0”, as the extension is being called, is set to run for six months in two further qualification periods for eligible businesses, and make a few changes to first iteration of JobKeeper.
These changes were first announced on 21 July 2020. With the changes not coming into effect until 28 September and legislation and Rules have been changed, and the ongoing uncertainty surrounding COVID-19, there remains the possibility information regarding JobKeeper 2.0 changing in short notice. Make sure to keep up to date the latest news and official Government information regarding this scheme.
This article will report on and give a basic outline of the announced changes to JobKeeper as they happen. Please make sure to get in touch with an accredited tax practitioner or accountant for any financial or business advice if you’d like to apply for or better understand JobKeeper.
Changes to Payment
From 28 September the current $1,500 per fortnight payment will be reduced down to $1,200 per fortnight for eligible employees and business participants working or engaged in a business 20 or more hours a week on average in the four weeks of pay periods to 1 March 2020. This rate will be reduced again to $1,000 from 4 January 2021 until JobKeeper 2.0 ends on 28 March 2021.
New Tiered Payments
One of the most prominent changes in the JobKeeper Extension is the introduction of two tiers of payment. JobKeeper will now be split between a ‘Full rate’ and a ‘Partial rate’.
Previously, JobKeeper was paid at the same rate to all nominated employees, at $1,500 per week. As above, from 28 September this rate – now the ‘Full rate’ – will be reduced.
The ‘Partial rate’ will apply to employees working on average less than 20 hours per week on average in the four weeks of pay periods to 1 March 2020.
How Will JobKeeper Payments Change?
|JobKeeper 2.0 (Phase 1)
|JobKeeper 2.0 (Phase 2)
|Dates Legislation Effective
|30 March 2020 – 27 September 2020
|28 September 2020 – 3 January 2021
|4 January 2021 – 28 March 2021
|$1,500 per fortnight
|$1,200 per fortnight
|$1,000 per fortnight
|$1,500 per fortnight
|$750 per fortnight
|$650 per fortnight
Other Changes to JobKeeper
JobKeeper 2.0 will also see changes to the eligibility criteria for business, in particular the ‘decline in turnover’ test. To find out more about these changes, Employsure recommends you speak to a qualified tax practitioner or accountant.
Eligibility for Employees
According to the Government, the current eligibility rules will not change in the JobKeeper 2.0 extension.
This means that, for the duration of JobKeeper up to 28 March 2021, subject to a business continuing to meet the turnover test, to be eligible an employee must:
Be currently employed (including being stood-down or re-hired) by an eligible employer
A full-time, part-time or fixed-term employee at 1 March 2020; or
A long-term, regular and systematic casual employee with 12 months’ service at 1 March 2020, and not a permanent employee of another employer.
Met the age requirements of the Scheme (generally, 18 years or older, although there are some exceptions)
Met the citizenship and residency requirements of the Scheme
And were not receiving
Government parental leave or dad and partner pay (under the Paid Parental Leave Act 2010); or
a payment in accordance with Australian worker compensation law for an individual’s total incapacity for work.
Eligibility for Employers
There is some criteria that employers need to meet to be eligible for JobKeeper 2.0. These criteria have slightly changed but still include that an employer must:
have employed at least one eligible employee on 1 March 2020
your eligible employees (including those stood down or re-hired) are currently employed for the fortnights you claim for
These conditions are not the only criteria that employers must meet to be eligible. For the other financial and business conditions you must meet, Employsure recommends that you seek professional financial advice on these matters.
Find out more about JobKeeper
Want to know more about JobKeeper? We have more articles that may help you better understand your rights and obligations.
Frequently Asked Questions
What is a JobKeeper enabling direction?
Employers who are covered by the Fair Work Act and receiving JobKeeper payments can give eligible employees “JobKeeper enabling directions” to vary certain terms of the employee’s employment, such as reducing their hours of work, duties and location of work. To issue such a direction, certain conditions must be met. To better understand these conditions, get in touch with Employsure.
How long will JobKeeper 2.0 payments go for?
These payments will last for roughly six months, from 28 September 2020 to 28 March 2021. Whether you continue to be eligible for the extended scheme will depend on continuing to meet the decline in turnover test. However, JobKeeper 2.0 may be subjected to shortening or lengthening in the future.
Is my business still eligible for the JobKeeper extension?
There are eligibility criteria that business must meet. To find out if you are eligible, Employsure recommends you contact an accredited financial advisor as many of the criteria concern financial aspects of your business.
Do I have to pay all my employees the JobKeeper payment?
Employees continue to accrue entitlements (e.g. annual leave, sick leave) and as per the hours, they ordinarily would have worked if they hadn’t been stood down, whether the stand-down is under section 524 of the Act or a JobKeeper enabling direction.
How do employers get the JobKeeper payments?
Employers receive these payments from the ATO. For further advice please get in contact with an accredited tax practitioner or accountant, as Employsure is not a financial advisor.
How do employees get JobKeeper payments?
Employees receive JobKeeper payments from their employers.
What about employees who have been absent on parental leave?
If you have an employee on parental leave as at 1 March 2020, you will receive a JobKeeper payment for them, as long as that employee is not receiving Parental Leave Pay or Dad and Partner Pay from Services Australia.
If the employee stops receiving Parental Leave Pay and is still on unpaid parental leave, you will receive a JobKeeper payment for them and you must pass this onto the employee.
What about employees who have been absent on long service leave?
The long service leave payments can be used to satisfy the minimum JobKeeper amount that you need to pay to the employee.
Can I direct my employees to change their working arrangements?
In short, yes you can. However, the proper answer to this is very nuanced. Please get in touch with Employsure to better understand how this affects you.
Do I have to keep records of employment decisions under JobKeeper?
Yes. The ATO requires you to keep records for five years to verify the details of any payments made to employees.
Employers have obligations to make and keep certain records for seven years, for example, records of annual leave taken and hours of work. As JobKeeper enabling directions can affect these records, they should be kept in case of any dispute with employees.
It is best practice to keep copies of records and decisions you make under the JobKeeper scheme so that you can demonstrate your compliance with the Rules and legislation, if required.
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