Facebook Live Event 13: Childcare And Job Keeper Subsidies

Published April 07, 2020 Views: 4

6/04/20

Ed’s back this Monday morning, discussing the latest movements in government legislation proposals including the childcare and job keeper subsidies. He outlines the approach employers should take when it comes to taking advantage, or not, of these schemes. As always, he concludes with a live viewer Q&A.

To help your business navigate the COVID-19 crisis Employsure’s founder and Managing Director Ed Mallett is hosting live events on Facebook, to discuss the latest events, burning questions Employsure’s clients are asking and to offer business and management tips. At the end of every session, Ed will answer a few questions that come through the comment section.

Facebook Live Event 13: Childcare And Job Keeper Subsidies

  • Transcript

    Ed: Hi, everyone. Ed here, checking in, as usually, at midday with some updates in regard to the world of workplace relations during the COVID-19 crisis, both here in Australia and in New Zealand. Thanks very much for joining again. I feel like I’m getting into a bit of a routine now where on Mondays I’m normally using this session for my own benefit, to be honest, to realign my thinking as to what I should be doing as a business leader and manager during this time.

    I find that weekends at the moment are not great for me. I don’t know if they are the same for you. But I inevitably slip into my sort of dramatic victim mode at some stage during the weekend. I’m frustrated with the way things are going on in the business world. This latest one for me was I spent most of my Sunday evening becoming an expert on the death rates caused by influenza across the world, trying to suss out exactly why it is then there’s such a dramatic response to COVID-19, a total waste of time.

    I’m not a medical expert, what’s the point of me trying to even pretend to be one reading various dubious sources online about this, that, and the other. And all it did was send me into this very frustrated spiral about the situation that is. Realigning my thinking, making sure that I’m thinking, not worrying. And I’m thinking clearly under pressure as I’ve advocated here, means actually only to come into work this morning and reset what I’m doing as a business owner and leader during this time, managing through this crisis.

    Whether or not there should be a crisis is a bit of a distraction, to be honest. We are in a crisis. I’m not gonna solve it by screaming from the rooftops that we shouldn’t be and that it’s no reaction or under reaction or whatever it is. I’ve got to get on with managing the risk in my business.

    And I’m finding this session, funnily enough, I was asked over the course of the weekend as to why we’re doing this. The fundamental principle behind why we do this is pretty simple. We have as a mission in our business that we want to help small business, which is our client base. But this has given us an opportunity to do this further afield than just our client base, helping out small businesses that aren’t clients, perhaps can’t afford to be clients at this stage. And this is a little dose of help from us.

    So that’s very important to us as a business, to be carrying on living out that mission even in trying times. There’s a secondary purpose for it, though. And I got a bit of niggle online about this at the weekend where someone suggested that we’re sort of trying to profiteer out of this or something. But it’s not that at all actually. We obviously don’t charge for this and we’re trying to help without any cost through this channel.

    But actually, the secondary element is I find it a very useful session for me personally as business manager or leader, in that it helps me recenter and refocus on what’s important. Once a day, I get this brilliant insight into the challenges that we’re all facing, not just me. So I’m not sitting here in my office in a bubble not understanding what the rest of the world is doing. And it’s giving me a really good connection to fellow business owners and managers who are battling with these issues as well.

    So I’m very grateful for what this is doing for me as much as anything. So, enough of the introspection. What we’re going to do today is three things before we go on to the normal questions and answers. And the first is, I’m just gonna flag with the childcare stuff that we talked about on Friday. A couple of childcare clients come forward and just said, “Hey, I know that there’s this subsidy coming, and on top of that, it seems like we’ll get JobKeeper. That’s not actually a great right thing for us.”

    I’m certainly not making any comment as to whether it’s a useful subsidy or not to childcare centers and after-school and so forth. But it is going to be there by the looks of it, assuming it gets legislated where you’re gonna get 50% of the childcare income that you would have received pre-crisis. And that will hopefully help in some way. Hopefully, something is better than nothing in that regard. But I’m not close enough to your businesses to understand the specific ups and downs of what that’s going to do for those childcare clients.

    The second aspect and probably the bigger aspect of it, which has been front-page news today, and will be for the rest of this week, I’m sure, which is JobKeeper. Now, JobKeeper remains shrouded in confusion and mystery and so forth until we actually get the legislation, hopefully at some stage this week. The one thing I would say without taking any pleasure from this is the kind of challenges and changes that I was worried about when the government came out and made it sound like it already existed a week or so ago.

    And I was worried that the opposition would start to niggle and get involved in it. And you’d start to see changes and twists and turns which mean that as of today, two days before it’s meant to be going through parliament, we really don’t know any more about what it’s going to be like. In fact, we probably know less.

    Yesterday you will have seen in the evening, Christian Porter came out and started talking about what JobKeeper is likely to look like. What is frustrating me enormously, I say this hopefully containing my frustration to some degree, but it is frustrating me to see both the opposition and the trade unions movement now getting involved in talking about the technicalities of how this is gonna be legislated and the risk for workers and so forth, ignoring the fundamental principle that we are seeing through here, which is that both small businesses and employees need help.

    And let’s stop worrying about whether it’s going to be done through the Fair Work Act, or go to need to amend all these modern awards and get back to the core principle, which is that we need some help quickly for small businesses and for their employees. I’d be amazed to see if this was being used as some sort of opportunistic thing for businesses to take advantage of their employees.

    That seems to be the approach that’s coming from the opposition now. It’s not that it’s as Christian Porter said overnight, it’s a lifeboat that’s been pushed out into pretty stormy seas and we need to get it done quickly. And it needs to be effective rather than getting tied up in a myriad of ifs, and buts, and maybes, and the technicalities of how the legislation will be amended, which is all detracting from the fundamental questions that we’re receiving through this stream.

    Which is, really if you boil it down, people wanting to know how is it gonna be paid and when. This is not a situation where people like to say, seemingly trying to take advantage of vulnerable employees or anything, it’s people genuinely wanting to get this money for their employees and also to support their businesses through this challenging time.

    So for what it’s worth, I suspect no one in the powers that be is listening to me. But if they are, and to the tens of thousands of small businesses that listen to this each day, as well as our own clients, I’d urge you just to stay on path, and get this done as quickly as possible, giving small business the best opportunity to get access to this as quickly as possible, so that they can carry on employing people.

    Don’t get tripped up in the complexities of what this is done through the Fair Work Act and all the other things that would have been mind-bogglingly difficult to follow in the media this morning. One thing though that has come out of it and seems to be just wafting around in the wind or at least everyone’s twisting and turning as to what the situation is over casuals under JobKeeper.

    So the position as it was announced was that…and when it got announced last week was that casuals would only be entitled to JobKeeper, or more importantly, their employers would only need to be entitled to claim JobKeeper on their behalf if they had worked for over a year and that they were regular casuals. There was a push from the ACTU to say that shouldn’t be the case. You need to open this up to millions of people who work on a casual basis moving between employers, and who are gonna suffer from that 12-month rule. And overnight, quite a lot of the media said it looked like the coalition was gonna accept that push and open up to a broader category of casuals. That’s just changed in the last hour again, in that Christian Porter seems to be saying, “No, no, we’re going to stick with the 12-month rule.”

    Now, again, that’s not law. We don’t know yet what the actual position is going to be. But what I can predict, I suppose, is that when this gets into parliament on Wednesday, that’s going to be a really niggly bit that there’s gonna be lots of conflicting opinion on. And where there’s conflict, you get delay, you get confusion.

    So watch this space. I just hope that that doesn’t become the sort of thing that stops this lifeboat being pushed out so that we can get on with saving businesses and helping employees. So that’s a very current change or clarification, I should say, I suppose, of positioning from the government on that. One final thing before I wrap up on JobKeeper and I’m sure that we’ve lots of questions today about JobKeeper, I’m happy to answer them.

    I flagged on Friday in my session, someone said or asked, “Do we need to notify if someone is being…if we are claiming JobKeeper for them?” My reaction to that was I can’t see why but it seems at this stage that the messaging from the government is that you would need to tell your employees if you were using JobKeeper to subsidize their employment. That will all be clarified, I’m sure, as and when this gets through legislation.

    But the point is for now, stick to the mantra that we’ve been saying for the last week or so. Press pause, don’t rush into JobKeeper promises, we need to see how this plays out over the course of this week. So I said that we do three things before we went on to the Q&A today. So the first was just flagging the childcare stuff. The second was JobKeeper. And then the third was just to give a shout out to one of our clients.

    I’ve mentioned them previously, Stage Kings, who did this wonderful pivot from working in the events industry, which saw them essentially shut down from operating to creating desks for people to use at home. Just a great pivot and a great story that actually got picked up in the “Sydney Morning Herald” here at the weekend. So I was a very proud supplier of Stage King, I suppose, to be in any way related to the success that they’re seeing.

    So congratulations to them on the attention that they’ve had on that wonderful pivot. Keep your pivot stories coming, please, guys, I really want to hear them. I want to see how you’re doing through all of this. I’ve seen a couple of shout outs on the questions and comments coming on the live stream. So one client saying that they’ve pivoted to making surgical supplies, which is great. Great to hear that. Please keep them coming.

    I think the stories of hope and opportunity during this time of crisis are very important to us all. So, on that note, let’s open up to some questions. No doubt, Stewie, some questions about JobKeeper.

    Stewie: Yes, there are but the first one actually isn’t. It’s from Leann, “We are currently recruiting as one of our admin team is leaving. The office is currently in work-from-home mode as we’re an essential service. While much of the training can be done remotely, some will require face-to-face and hands-on training. What are the best steps we can take to ensure the health of the team during this time?”

    Ed: So Leann uses the term, “we are an essential service,” which seems to suggest you might be in New Zealand because that’s the only place that there is a true essential service category at this stage. At the moment everyone can work and the principal is in Australia…sorry, this is in Australia. In Australia, you should work from home if you can, which Leann’s business seems to be doing. But if there are elements of that and switching and suggesting that she might be in Australia here, I appreciate it. So it’s hard to tell between the two, but let’s break it down. If she’s in Australia and she needs to do some face-to-face training, that’s entirely possible subject to social distancing.

    And again, in my office this week I’ve got a team here. We’re all social distancing, and we’re staying the requisite distance apart. We’re practicing good hygiene and so forth. So Leann can do that if she’s in Australia. Even if everyone’s working from home, they could meet either at someone’s home space, probably less than ideal than meeting at the workplace to do whatever training needs to be done for this new admin member before they then go home.

    I know, for example, at Employsure in Australia, we have an induction of new employees on Tuesdays. And what we’re doing is bringing them into the office, doing the induction, and then sending them to do homework after that, once we’ve upskilled them and given out the requisite IT equipment and so forth.

    In New Zealand, if you are an essential service and you’re working…even if you’re working from home at the moment, if you’re a true essential service, then my understanding is that you could work from your workplace if you needed to do that training from there if you’re a true essential service.

    Stewie: From Tammy, “Do we pay JobKeeper to staff on maternity leave no longer being paid parental leave but still voluntarily away from work?”

    Ed: So if someone’s in Australia, if someone’s away or on parental leave, they’re not on paid parental leave anymore, do we have JobKeeper to them? The answer would typically be no. They are on unpaid parental leave, but when they return from that to their role, and bear in mind that if you would make any amendments to their role in their absence, you would still have to consult with them and seek their agreement.

    Say for example, that when the person returns from parental leave, they’re going to have moved from full-time to part-time hours. That’s not something you can do unilaterally without consulting with them. So you’d still be needing to speak to that person at the moment, but you wouldn’t be needing to pay them JobKeeper.

    Remembering, as we said at the moment, JobKeeper is not a right. It is an option for an employer. So you wouldn’t pay that person typically JobKeeper, you’d wait for them to return to work. And at that stage, you might start considering to pay them JobKeeper. But a big health warning on that, be careful not to forget about those people on parental leave at the moment of get to consult with them about any changes that are happening in your workplaces.

    Stewie: An interesting one from Fernando. “Our company has put in a 20% pay reduction across the company to preserve cash. Our sales are still strong. We are not forcing staff to work 5 days, they can work 4 days due to the 20% reduction. What if sales never go down and we continue as is? Can employees ask for back pay on the 20% originally reduced?”

    Ed: So, Fernando’s company has done a 20% reduction in pay. I think the language used was enforced, which that always worries me a bit. It needs to be by agreement. So assuming that there has been an agreement to go down by 20% pay, and employees seem like they have the option to do that over 4 rather than 5 days. And it’s asked what happens if sales continue to be as strong as they seemingly are at the moment, can employees claim back pay?

    The answer is not if they’ve agreed to that variation. Now, you may have had that variation agreed for a period of time. The truth is, if your business is able to operate at previous levels on a revenue line with employees working at 80% of the time then you’d probably need to be looking at the efficiencies in your business anyway.

    Stewie: From Amanda, “We’re concerned with how JobKeeper will allow for small businesses that are growth companies. How can we demonstrate an impact due to COVID-19 when our steady-state isn’t like a normal small business?”

    Ed: So great question from Amanda saying what about businesses that are growth companies? So, this time last year, they were doing less than they are doing this time this year, even though there may be actually getting impacted by COVID-19. It’s a question I’ve seen come up with a fair bit in different guises.

    People saying, “I just happened to have a good March last year,” and so forth, but other confusing situations. We have our own version of that, we’re a subscription business. And what that means is our clients carry on paying us on subscription but what we’re concerned about is not the today or this month, but actually, over the course of the coming months we will see subscriptions decline. We don’t know yet but equally, we want to know what we can do with JobKeeper.

    So, there are various different forms of that question, and my hope is that when it comes to it, there is decent understanding from the government that a one-size-fits-all to that approach won’t work and the 30% won’t work. That’s really my only thing I can say at the moment is that the hope is the government has worked out over the last week that treating everyone is a simple cash flow business that has been operating for over a year and is on some basically level, same level of business and we would easily be able to see if they’ve dipped down 30% this year is somewhat naive, to be honest. That’s just not the way business works. And I hope that there’s a more multifaceted approach when it comes to it on Wednesday.

    Stewie: From Luis, and it’s been followed, this question, “Is it clear if the JobKeeper payment can be used to pay employee’s annual leave during any period of shutdown or business downturn?”

    Ed: Can you say that one again, Stewie?

    Stewie: Yes. “Is there any clarity around if the JobKeeper payment can be used to pay employee’s annual leave during any period of shutdown or business downtime?”

    Ed: So query is, if someone’s on annual leave, let’s say, maybe you’ve agreed with them to take annual leave during a slowdown or shutdown of your business, so you’re still paying them but that you’re paying them out their entitlement to annual leave, can JobKeeper be used to either supplement or subsidize that?

    Unclear at the moment. My best guess at this stage is that paying an annual leave is a form of wages and that that will ultimately be credited back to you. But just a bit of a sort of sharp aside on this for JobKeeper, I just want to flag one thing that I also really get to understand from when this goes through if it goes through on Wednesday, is there’s a lot of talk at the moment about the fact that you’ll start getting JobKeeper payments in May based upon the fact that March has just finished, so you’ll be putting in your BAS in April, 28 days later you should get a payment under your BAS for the quarter just finished.

    Talking purely about businesses that operate on quarterly BAS which is a lot of small businesses, the vast majority of small businesses operate on quarterly BAS. Remember, you’re only gonna get JobKeeper in May for what happened in March. Everything from today, we’re in April now, we’re in a new quarter. You’re not gonna get that till probably July, August.

    So you’re going to be paying April, May, June quarter, and you won’t be getting that payment back until July or August. So there’s quite a lot of talk about getting money in May but in reality, it’s gonna be quite a lot later for the current quarter.

    Stewie: From Joe, “Are we able to claim JobKeeper as directors but keep it in cash flow rather than paying it to ourselves?”

    Ed: So Joe asked, “As directors, can we get JobKeeper and keep it in cash flow?” So the only way my understanding of how JobKeeper would work is, first of all, directors will only get it if they are employees, representatives such and doing PAYG through BAS. The way in which the flow of casual capital will work on JobKeeper is that you would have had to have paid the 1500 bucks in principle to the director, employee, and you’ll subsequently get it back. So there’s no net benefit to the business on this.

    The only way I suppose that you could do it is to represent through your BAS that those employees have been paid 1500 bucks, those director employees, but they have in some way waived or lead that back to the business so that the businesses net $1500 off better at the end of it. But that’s a bit of complexity. I suggest you speak to your accountant once we see what the legislation says.

    Stewie: From Karen, “What about contractors that work for us prior to the 12 months and are now employees?”

    Ed: So contractors that work prior to the 12 months and are now employees, so I’m gonna assume that they’re permanent employees rather than casuals. You don’t need to be in a 12-month employee to potentially qualify for JobKeeper, a permanent employee, you just need to be employed on the 1st March, 2020.

    Stewie: This one from Vanessa, we actually covered this last week, but it’s worth probably returning to. “Ed, do you think we are going to be forced to do the JobKeeper subsidy or is it going to be employer choice?”

    Ed: I think Vanessa is my number one fan here. I’m gonna embarrass her by saying this, but I can see that she’s a top fan, which I’m not sure how that happens but I’m very grateful for whatever that means, Vanessa. So, are we gonna be forced to doing JobKeeper? So the answer to that is it doesn’t look that way at this stage.

    There seems to be…that there’s quite a muddle in the media at the weekend, but the real issue for JobKeeper seems to me to be this is if you’re gonna get it paid through BAS, as is the position I have been espousing, and that therefore you’re bridging a cash flow loan…sorry, you’re bridging cash flow between the government and your employee essentially, is that something you have to do?

    And we’ve been saying, no, you don’t have to do that, you can choose to do it. And so in the case, for example, of an employee who earns under $1500 per fortnight, are you required to top them up to $1500? It doesn’t seem that you’re gonna be forced to do it. I don’t see how the government could fairly do that and ask you to make that bridge of cash flow, particularly if your cash flow’s depleted.

    So I don’t think JobKeeper will be forced on people. On the flip side, a lot of the media has been talking about this weekend has been the problem of will JobKeeper enable employers to unilaterally force people on leave and/or reduce their pay to $1500 and ask them to do the same job?

    To be honest, those are not issues that have come up much in the conversations I’ve been having with people. There seem to be red herrings that are being used by the opposition particularly at the moment to put question marks about JobKeeper. I don’t think anyone’s really talking about unilaterally forcing their employees to take $1500 if they earn more to do the same job for that $1500, but that’s the confusion in the media over the weekend.

    Stewie: Clive just wants some bit of clarity around just some advice if possible. “My cafe is closed. I cannot afford to pay around 15 staff $1500 each twice before JobKeeper payments start. I’m not going to borrow money to do this. And it doesn’t seem to be any media discussion about this. And staff are saying to me, I must pay their entitlement. Do you have any advice?”

    Ed: Yes, Clive, great question, actually. I’ve been trying to really break down who JobKeeper, in the form I understand, it will suit. I don’t think it suits businesses that have slowed down significantly or are shut down currently. So cafe might fall into that situation. Might still be doing some takeaway, but the business might have slowed down.

    Clive’s saying, “My employees are saying I’m entitled to this money, essentially give it to me and you claim it back from the government later.” Again, I don’t think that there is an obligation on Clive to do that. Clive can choose if these are permanent staff and he wants to keep them on his books, he can choose to pay them the $1500, but if he can’t afford it, there’s no obligation on him to rush out and get a loan for his cash flow.

    There was some talk in the paper this morning which seems to support my belief that there is gonna be a requirement that employers pay…sorry, if you choose to pay JobKeeper, you will pay it first, reclaim it later. There was a suggestion that the treasurer has been out to bank saying, “Please confirm that you will supply businesses with the cash flow to support this.”

    That language tends to indicate the businesses that want to do this, but can’t afford without a cash flow, are gonna have to go out and get some sort of funding arrangement. My initial recommendation would be, be very careful going out and taking on debt at this stage if you’ve got cash flow challenges already.

    Stewie: From Grant, “Can the working owner of a small business claim JobKeeper if they are not a sole trader?”

    Ed: Can a small business owner claim JobKeeper for themselves if they are not a sole trader? Is that the question?

    Stewie: Yes.

    Ed: Yeah. So, if they’re incorporated in some way, they need to be employed by their small business, and would need to otherwise qualify for it. But as an employee of the business, they could potentially get the JobKeeper. [inaudible 00:26:53] Leann just flagged that she’s in Queensland in respect to the questions that she asked earlier on. She was saying she was an essential service, and with the admin staff member. So in Queensland, Leann, you could…as long as you follow social distancing, you can meet with that staff member. I suggest you do it at your workplace in order to do the training for them.

    Stewie: Cool. From Sarah, “Do we need to be mindful of how we performance-manage staff during this whole period?”

    Ed: Yeah. This is a really interesting question. Do we need to be mindful of how we performance-manage staff? And I was just thinking about it this morning, actually, relative to the amount of phone calls that we’re receiving from clients, which still remain very high. And I think they’ll only go up this week with the JobKeeper confusion. But I was thinking to myself, I wonder what’s gonna happen as JobKeeper beds in, time settles down?

    Are we going to see people start to call us with the typical kind of questions, which is, “I’ve got an underperforming member of staff, how do I deal with them?” Disciplinary issues, all of those sorts of questions. And I suspect if this goes on in this sort of slightly weird limbo environment we’re in at the moment, that those questions will probably die down a bit and people will start to move on to JobKeeper and they’ll find a new operating rhythm.

    That doesn’t mean you can’t manage your staff during that period. Regardless whether they’re on JobKeeper or not, you’re not under some social obligation, moral obligation to employ people who are not doing their job if that’s what they’re being required to do. So I’d urge you to carry on being business managers, fundamentally, and to manage your business where you’re not out there running charities to people if they’re not doing the job that’s being asked to them.

    Stewie: From Leann, “A cafe that has closed due to COVID-19 employed long-term casual staff, they have slipped down their staff. Would the cafe be able to apply for JobKeeper and pay them until the cafe reopens?”

    Ed: Yes, cafe owner staff have been stood down. Can they apply for JobKeeper and pay them until cafe reopens? Yes, that’s what the government would suggest you should do. But my suggestion is that JobKeeper might not actually suit you as a cafe owner, because you don’t presumably have any cash flow because you haven’t got any operations going at the moment.

    Consequently, you’d be needing to pay the $1500 a fortnight out of whatever cash reserves you have, or taking some sort of funding to do it. Query, whether it would be better for all parties concerned for those people just go on JobSeeker, not JobKeeper. They get slightly less per fortnight, which they’d much rather be on JobKeeper, I suspect, but you’d also have to bridge the cash position between today and when you get refunded by the government.

    Stewie: And this is a scenario that we touched on last week but it’s a new scenario today from Carolyn. “We’re a club that has been fully closed. Most staff will clearly be entitled to JobKeeper but unclear about one who has worked proximately 3 hours per week for us longer than 12 months. But this employee works at another job that hasn’t closed and for all I know hasn’t had a decline in revenue. Who decides? Us, the other employer, or the employees?”

    Ed: So it’s a brilliant case study of the mess that awaits, to be honest. A situation where an employee seems to satisfy the casual requirement of 12 months and regular hours, but it’s known that they have another, at least one other casual job. Do you have to pay JobKeeper? Again, I stress that you don’t have to pay JobKeeper to anyone if you are paying over $1500 a fortnight anyway, and you otherwise qualify, you should get it back. If less than $1500 a fortnight, seems it’s gonna be a choice to top up.

    But what happens here where they’ve got another job that may or may not qualify for JobKeeper, I don’t know. No one knows at the moment, it’s a mess and they’re gonna have to work out some way of administrating, which employer gets the benefit of JobKeeper and which doesn’t because it could be fundamentally quite unfair of ways if you think about it.

    Let’s say there are two businesses, you do three hours per week at both businesses. Both business and principle applies to JobKeeper. Why should one of them get your wage subsidized and the other not? I don’t know. And we’ll have to see how they work out that kind of problem. I just hope they focus on solving those sorts of problems, not the sort of nonsense they’re talking about in the papers today about whether they amend the Fair Work Act or awards and so on.

    Stewie: Connie is a client. She asks, “We reduced our staff to a 30-hour a week. We have since been able to get a few smaller contracts approved and would like to, therefore, go back up to a 40-hour week, at least until the end of May. How can we make the changes but still be flexible enough to get back to the 30 hours at a later stage if need be?”

    Ed: So Connie asks, they have successfully reduced their hours down to 30 hours a week from what sounds like permanent full-time staff. They’ve had some good news and they’ve got some contracts, how do they go back up to…just a pause there, Connie, 38 hours, not 40. If you’re over in Australia, it’s full-time hours.

    The way in which you do that is to pick up the phone to each of them. Talk about bringing them back in for an extra eight hours a week. Seek their agreement, but put that in writing and get their agreement until the end of May which is when you say that you’ve got this flow of business until and say after that, you’ll review it again. Or say words to the effect that it will go back to the 30-hour week at the end of May unless otherwise notified. Just so that you’re not doing too much to and fro on that.

    Stewie: From Joanne, “We run a dance studio. Can staff be onsite doing online lessons with social distancing? My calls to health department last week said no, as we are considered a gym and we need to close. Do you have any insight into this?”

    Ed: So dance studio, can they be doing onsite lessons with social distancing? My understanding is not, regardless of the fact that you could in principle, and this is the sort of madness of the situation at the moment. I think you could do a one-on-one lesson outside. But if it needs to be in the studio, the answer would be no.

    And as far as I’m aware, that can’t be done in a studio that should otherwise be shut. There’s the other way in which it seems like it could be possible. It looks to me like you can still have a personal trainer come to your house so you could potentially do one-on-one dance lessons at someone’s house subject to social distancing. But dance studios, you might remember Scott Morrison, Prime Minister Morrison fumbled around with the concept of what bar was, which is a form of dance, and that was specifically said to be closed.

    Stewie: From Anne, “Can an electrical business getting a government subsidy for their apprentice still get JobKeeper for that employee?”

    Ed: So someone’s getting the subsidy for an apprentice, can they still get JobKeeper? It’s not clear at the moment. It looks like it would be a form of double-dipping to get JobKeeper when you’re already getting the substitute for the apprentice. But hopefully, that’ll be clarified on Wednesday as well.

    Stewie: From Tim, “Can an employee lend the business the $3,000 to cover the cash flow problem and allow the employer to claim JobKeeper?”

    Ed: It’s a really interesting question, Tim. And maybe actually just as an aside, I’d love to hear from you guys as to what your thoughts are on this. I reached out to two small business lenders this morning and just say, “Guy, do you wanna have a chat about this question of bridging funding between JobKeeper and employees?”

    I don’t know if people are needing those cash flow loans. As I said, I’m not sure I’d advocate you taking them. But is there a good way of getting these up and running? Maybe the employee, bearing in mind that someone that’s not working might get $1500. It’s not a wage, it’s just some sort of flow of subsidy through to them. Should they be paying the interest rate on that? I’m not sure.

    Those sorts of questions are pretty fascinating to me. And that’s the question that I posed there, which is could the employee lend to the government…sorry, lend the company three grand a month in order for them to get it back? Feels ugly to me on first glance, to be honest. Remembering that any anything that feels like you’re twisting the arm of an employee who’s vulnerable at a difficult situation just doesn’t feel right to me.

    But actually physically lending or writing some sort of lending note to the company doesn’t feel right to me. Is there a way we’ll see on Wednesday of saying to the employee, “Essentially, you’ve earned those wages, but I’m not gonna pay you until my BAS is paid.” Again, I suspect the government is gonna say that’s kind of undermining the spirit of this, which is that people are getting cash flow to their pockets so they can pay their rent, pay for their groceries and all those sorts of things.

    So, it’s a mush of ideas and situations. But I’d love to hear from you on here, though. If anyone would have genuine interest in that sort of cash flow positioning, if you could get easy access to capital to support cash flow to fund JobKeeper, is that something that you’re actually wanting? Is to say I’m not sure I’d recommend it, but is that something that you’re wanting?

    Stewie: From Lorraine, a general question, “Has the employer got the right to request that staff take their long service leave after 12 years?”

    Ed: Has the employer got the right to request that staff take longer service leave? I’d need to have a check of that. I think there’s too many variables to chuck out a single answer to that, but we’ll have a check and we’ll reply to that online.

    Stewie: Okay. Tracy asks, “If we have stood down our permanent part-time staff due to closure, can I re-engage them as they would possibly qualify for a JobKeeper? Do I need to re-engage them before this passes legislation?”

    Ed: Do you need to put permanent part-time staff that have otherwise been stood down? Do you need to re-engage them? They’re still employed with you if they’re on stand down. They don’t need to be doing an amount of hours for you. So in theory, it’s JobKeeper I think it’s going to work, you would just pay them $1500 a fortnight on stand down. That will subsequently come back to you through your BAS. That seems to be what’s going to happen with it.

    Stewie: From Fiona, “Can you make your staff work more hours if you’re paying them JobKeeper money?”

    Ed: Can you make your staff work more hours? So this is presumably someone that’s getting less than $1500 a fortnight. Can you require them to work more hours? The answer is no. You could ask them to do more hours in order to get that money, and they might agree to it. But otherwise, they would be entitled to, if you choose to pay it, the top-up up to $1500 in principle for doing no extra work, which is one of the things that has people scratching their heads at the moment.

    Stewie: Again, this is a general question around JobKeeper, which we touched on last week, but we’re touching again from Alley. “If we are paying JobKeeper to an employee and that employee works some hours during the week, but not full normal hours, are they paid that on top of JobKeeper? Or is JobKeeper reduced for the number of hours worked?”

    Ed: So if someone’s paying…they’re working some hours, do they get the $1500 on top of those hours?

    Stewie: Yeah.

    Ed: Only up to the…if they’re getting less than $1500, it seems like JobKeeper is a top-up to $1500. So someone that’s earning, let’s say, $500 a fortnight, you would top it up to $1500, seems to be the language used by the government. But these are the sort of things that will become clear on Wednesday.

    Stewie: Yeah. Again, a general question from Michael that’s has been followed. We touched on it last week. But again, we’re touching on again. Michael asks, “Can JobKeeper be applied for at any stage in the next few months? Manufacturing business is in decline, but hasn’t yet met the 30% reduction from last year.”

    Ed: So what happens if your business doesn’t yet meet the 30% reduction threshold? Watch this space on Wednesday. We need to understand what happens if you hit in April, May, or June, what is the 30% reduction threshold? How’s that gonna apply? What if you had a good month, this time last year? All of those questions need thrashing out by Parliament.

    Stewie: “Just a follow up from last weekend. You mentioned last week that we were seeking some clarity around public holidays. Easter is approaching. Have you had any updates around that?”

    Ed: So the position on public holidays of Easter is if people are stood down on the current basis under the Fair Work Act, you’d need to pay public holidays, the holidays, which is an oddity, let’s say they would otherwise have worked this coming Friday. They’re currently stood down. The way the Fair Work Act works is on Friday, you would have to run a day of payroll for them in your next payroll run and similarly for Monday, if they would otherwise do work for that. So you get this oddity where they would be getting paid nothing, except for two days potentially over the course of this month.

    Which we’re waiting to see at the moment whether Fair Work or anyone else is going to say, “No, that oddity needs to be remedied,” because otherwise, you can have this mass of workers who are on stand down. The companies are otherwise feeling like they don’t have to pay them and subsequently having to pay for that Friday, Monday. And what we don’t wanna see is a raft of underpayment claims where in weeks or months to come, people turn around, say, “I’ve just heard my mate got paid for Good Friday, and I didn’t. You should have paid me even though I was on stand down.”

    So the current position is that that’s what you got to do. My advice to anyone would be if you have workers that were otherwise working on Friday or Monday, that they should get paid for those public holidays. If they are stood down and they wouldn’t have worked on the Friday anyway, it doesn’t matter, or the Monday but it [inaudible 00:41:46] they would otherwise have got a paid public holiday on those days.

    Stewie: “We’re seeing some data emerge about a potential increase in workers’ compensation claims from employees who are working from home, with the risk of trips, falls, and poor ergonomics, perhaps greater at home than in the workplace. What is your advice to employers around this?”

    Ed: So with workers comp claims from people working at home. Whether that’s actually happening yet, I’m not sure, and there is a risk that there could be people tripping, falling, ergonomic issues at home. My advice to all employers is that in the rush to get people home if you are working from home at this stage, you probably haven’t considered your health and safety policies for working from home.

    You should be considering that even if it’s essentially a letter to the employees saying, “These are the terms of our policy. This is what we expect of you and this is what we expect in terms of ergonomics,” and so forth just to make sure that if and when it comes to it, your obligation to provide a safe workplace to your employees is properly met. So get a policy in place.

    If you’re an Employsure client, reach out to us, we can help you with that and help you with those work health and safety policies for working from home.

    Stewie: From Nicole, “We’re a contracting business. Will they be represented in JobSeeker legislation do you think? Turnover has increased this financial year from last, but we’ve had a decrease in potential revenue because of job closures. This is not a reduction if compared to a similar period last year.”

    Ed: So it’s a contracting business. I’m gonna read into that that they have some form of labor higher business where they’re providing staff to labor higher sites or something like that. So those staff are ultimately gonna be employed somewhere or they themselves are gonna be entities which employ people.

    So classic one is in the contract cleaning business, for example. You may subcontract out that cleaning to other entities who then employ people. Ultimately, there’s an employer somewhere in that chain. And where that employer is, is where the JobKeeper legislation, I believe, will sit.

    Stewie: We’ve touched on this last week too, but things have moved at a fair pace since last week. So it’s worth touching again. From Leann, “Can an employer force someone to work from their office, even if they can perform their job at home and that is the employees’ preference?”

    Ed: Can an employer force someone to work from their office? I think this is Leann in Queensland, again. We’re giving lots of good attention today, Leann. I hope that… So, the question is can you be forced to work from your office even if the job can be done from home?

    That doesn’t seem to be in the spirit of the guidance given so far, which is you should work from home if you can. There should be a good reason that your job isn’t reasonably practicable to be done from home. I suppose put it this way, if the person…and I’ve thought about this myself as I drive into the office, if I got stopped by the police today and they said, “Why are you driving to the office?” I’d like to have a decent response as to why I need to be in here to do my job, and why I couldn’t do that from home.

    I hope that that’s an explainable position from my perspective, as I need to manage the business, I need to be fielding all sorts of inquiries from different people, including seeing key operations staff to check that our clients have been properly served. But you’ll have to ask yourself, Leann, whether you’ve got a similar thing that you could be saying on a litmus test of what happened if the police asked you today, what would your response be?

    Stewie: Again, another question asked slightly differently from Theresa. “Will working with people to reduce hours to keep the business afloat. If we got to the point that we are surviving on JobKeeper, is it fair to ask that employees work the equivalent hours of this payment?”

    Ed: So someone’s getting paid less than JobKeeper but I need more hours done, is that right? Or I just want more hours done? So I think we’ve answered a version of this, which is you can’t require someone to do more hours just because of the JobKeeper. You’d need to seek their agreement to do more hours.

    Stewie: From Lynette with a few people following this. “If an employee voluntarily chose not to work, because they didn’t want to run the risk of getting COVID-19, and we are paying them their annual leave, do they get paid for the public holidays or is this still paid as holiday pay?”

    Ed: So an employee has decided that they don’t want to work. You’ve very generously decided to pay them annual leave even though they are in principle able to work in your workplace, do they get paid for public holidays? Yes, in the ordinary course of events, if that’s the day that they would otherwise receive public holiday pay for, then that would be paid as a public holiday, not out of their annual leave balance.

    Stewie: This one’s related to one from a few questions that go in on workers’ compensation. “What is your advice to employers who may face a workers’ compensation claim from employee who claims that they’ve contracted COVID-19 in the workplace?”

    Ed: So an employee… This is a really good one, actually. It’s something that I thought a bit about. Employee claims they contracted COVID-19 in the workplace. What’s your advice on that? So this is why it’s so important they should have been following government advice and not necessarily…certainly not going below that advice.

    You may have decided to go over and above it. My recommendation has always been to follow what the government is saying. If someone come on track to COVID-19 in the workplace, and you have in principle a safe system of work in place which is on following government advice about social distancing, “I’ve recommended people do this, etc. I’ve communicated it to them.” I’d struggle to see anyone having a workers’ compensation claim against you or otherwise for breach of health and safety laws.

    I’d struggle to see that anyone would have a decent claim on that basis. But we might see a raft of these claims coming through if people do start contracting that at work, but there’s a whole list, there’s sort of chain of causation issues which to show that this was caught at work, to show that the employer was careless or didn’t follow government advice, all of those things would be pretty difficult to be able to prove.

    Stewie: From Ashley to do with JobKeeper and casuals. “We employee most of our casuals for our events, which happens sporadically throughout the year. Do we still have to pay those casuals that have been on the books for more than a year but have only worked 10 to 20 shifts throughout the year?”

    Ed: Do you have to pay casuals JobKeeper that have been maybe working regularly for over 12 months, but they don’t work very frequently? Again, you do not, on my understanding of the proposed legislation, have to pay JobKeeper. There is not going to be a requirement on any business to pay JobKeeper. The recommendation to those sorts of employees would be to go on JobSeeker in the absence of that.

    Stewie: From Carolyn, “I have a staff member due to go on to our paid parental leave scheme shortly. What if our business faces a further slowdown or stand down scenario which would include consideration for her role? How do we handle this properly if it happens either before she goes on leave, or whilst on leave?”

    Ed: So really interesting question. So someone’s about to go on parental leave, it sounds like this company has a paid parental leave scheme. What happens if there’s a slowdown, shut down whilst that person is away on leave? This is not unique to the COVID-19 situation, but it’s something often overlooked by people.

    If you’ve got someone away on parental leave, you need to consult with them about any changes to their role. And that might include any future redundancies, for example. So, it’s very easy for people to make this error, I think, and to forget to include those people in the full consultation and communications that are happening with the workforce. Just make sure that person is communicated to so that they’re not left out and they don’t potentially have claims against you for general forms of discrimination, for not treating them fairly, or discriminating against them because they’re away on parental leave.

    So, we’ve been going for the best part of an hour. I’m just gonna answer one quick one here. I can see Richard Morris is asked in capitals. He wants a question answered quickly, which is understandable. Richard, you said, “Is JobKeeper taxed?” The answer to that is it looks like it will be if it is paid as a wage subsidy. That sounds clear as mud, I’m sure. But basically if someone is earning at or over 1500 bucks a fortnight and you have been paying them wages for that, you’re currently paying them wages to do that work, it looks like what will happen then is that the $1500 is pre-tax. So in fact, by the time they get it, they’re just getting their wages at $1500 net of tax and you’ll get the $1500 back from the government.

    If it is not paid as wages, it’s also a paid gross, but…sorry, you will claim it back gross, but I’m not sure how it ends up in the employee’s hands at this stage. I’m not sure at what rate they would be taxed on it, how it’s gonna be taxed, but it’s meant to be gross over taxation. Yeah.

    So, guys, that’s it for me for today. Still some great questions coming thick and fast. We will answer them as ever during the course of the day. Otherwise, I look forward to seeing you tomorrow. Not that I don’t want to carry on talking about JobKeeper. We’ve got to keep answering. Those questions are all very valid ones. I’d love to hear your opinion in the meantime as to whether some sort of cash flow support is what businesses are crying out for at the moment. If JobKeeper does mean that you’ve got to pay now, reclaim later, I’d love to hear that. I’d love to hear some more pivot stories like Stage Kings, and we’ll pick up on those things tomorrow. Till then, employsure.com.au/coronavirus, employsure.co.nz/coronavirus. Thank you.

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