JobKeeper Extension and IR Flexibility Welcome, but Business Owners Need to Be Cautious

Published July 21, 2020 -
small business owner hears news of the jobkeeper extension

The extension of the JobKeeper wage subsidy, along with its associated industrial relations flexibility, will help business owners make smart, fair decisions that will keep their doors open and staff employed, according to Employsure, Australia’s largest workplace relations advisor.

Prime Minister Scott Morrison has revealed that the Federal Government’s JobKeeper program will run at a reduced rate for another six months from the end of September, while JobSeeker will continue for at least another three.

“This extension of JobKeeper and the IR flexibility that comes with it, will give small business owners a sense of certainty to move forward and make smart employment decisions into 2021,” said Employsure Managing Director Ed Mallett.

“Our main advice to business owners right now is to fully understand the details of the amended scheme, its potential repercussions and to get professional advice on how to implement it across their business.

“Even more importantly, employers shouldn’t use it as a reason to bury their heads in the sand. Subsidy shouldn’t be confused for sustainability, and if you need to make hard decisions about the viability of your business, don’t delay the inevitable.”

The wage subsidy will initially be reduced to $1200 per fortnight (fulltime) and $750 (part time) from the end of September, and dropped again to $1000 per fortnight (fulltime) and $650 (part time) in January. Eligibility criteria will apply.

“Business owners need to be cautious about how this will work day-to-day,” continued Mr Mallett.

“JobKeeper 2.0 will still need to go through Parliament to be legislated and that’s where the real rules about this program will emerge.

“There will be the inevitable potholes that business owners will find frustrating. For example, the February before the pandemic is being used as a benchmark to assess ‘employee hours worked’. What if an employee was on leave in the February pre-COVID? Will seasonal businesses that operate off-peak in February be disadvantaged by not having enough financial support to get them through their peak season that occurs in December?

“These are all questions that get answered after-the-fact, leaving small business owners to navigate the confusion in the absence of clarity.

“JobKeeper has been successful and it is welcome news that it will continue, but it’s not perfect, and we can’t pretend that JobKeeper 2.0 won’t present pain points and frustrations for many business owners.”

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