It’s a difficult time for businesses across all industries. The COVID-19 global pandemic has severely impacted trade and services, leaving employers to stand down staff both permanently and temporarily, as well as reduce work hours for continuing staff.
The Federal Government has announced a $130 billion wage subsidy plan to counter the impact on Australian businesses and our economy. We’ve provided an outline of what it entails and what you’ll need to do to access this increased wage subsidy scheme, along with how you can determine the eligibility of your employees.
In a nutshell
The JobKeeper Payments scheme is an incentive for employers to keep workers on for as long as possible. The scheme will reimburse employers up to $1500 per fortnight, per employee, as long as the business meets the criteria.
Businesses need to be up to date with BAS statements and Single Touch Payroll in order to receive the stimulus and employers must register with the Government direct to access the scheme.
The payment applies to full-time and part-time workers along with sole traders. Casual workers are also eligible if they have been employed for at least 12 months.
Eligible employees are employees who are Australian citizens, holders of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who have been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder.
If the business meets criteria, they will receive the $1500 subsidy payment per eligible employee and also have the option to add more money on top of that to fulfil the employee’s complete wage.
For a business still operating, they must continue to pay their staff their regular income but will receive the $1500 payment to subsidise each wage. They will continue to be required to pay the superannuation guarantee on their employee’s income.
For a business that has stood down employees, the employer will be required to pay them a minimum $1500 a fortnight. Paying the superannuation guarantee is at the employer’s discretion in this case.
A part-time worker being paid $1000 a fortnight would still attract the full $1500 subsidy, with an employer not allowed to pocket the difference.
The scheme also applies to workers who have been retrenched rather than stood down. If they are re-hired their employer will receive the $1500 subsidy.
Criteria to qualify
• Employers must register with the Government to access the scheme
• You must prove that your business has suffered a decline of 30% in revenue
• In the case of businesses earning over $1 billion, that reduction must be 50%
• The payment applies from 1 March
• Businesses will receive reimbursements from the first week of May, with those reimbursements to be backdated to 1 March
• If employees have been stood down from 1 March, they are still eligible for payments
• The business must not be subject to the Major Bank Levy
Refer to this full overview of the JobKeeper Payments scheme for employers, along with this Employer Fact Sheet and Employee Fact Sheet.
If you’re an eligible employer, you’re encouraged to register for the JobKeeper scheme as soon as possible.
EPG clients already have access to employee eligibility reporting via your payroll manager login. If you need further clarification, please reach out to your payroll manager.