COVID-19 UPDATE: JOBKEEPER SUPPORT EXTENDED TO 28 MARCH 2021
The Federal Government has today extended the JobKeeper payments through until 28 March 2021, however there will be a number of important changes Employers will need to be aware of.
Current JobKeeper scheme to remain in place unchanged to 27 September 2020
Firstly, the existing JobKeeper payments will remain in place unchanged until 27 September 2020. This means if your business is currently receiving JobKeeper payments, the arrangements will not change and these payments are still available until 27 September 2020 .
Reassessment for eligibility required from 28 September 2020 onwards
Then, on and from 28 September 2020, the JobKeeper payments will be targeted and tailored to businesses that have been most significantly impacted by the COVID-19 crisis until 28 March 2021.
These changes will be in place on and from 28 September 2020 and will involve:
stepped-down payment rates; and
2 tiers of payments based on employee average hours of work per week.
In order to be eligible during the extension period of 28 September 2020 to 28 March 2021, businesses will be required to reassess their eligibility with reference to their actual turnover in both the June 2020 and September 2020 quarters. Businesses will need to demonstrate that they have met the relevant continuing decline in turnover test in both of those quarters in order to be eligible for the JobKeeper payments from 28 September 2020 to 3 January 2021.
Then, businesses will need to further reassess their eligibility in January 2021 for the period from 4 January to 28 March 2021. This means, businesses will need to demonstrate that they have met the relevant continuing decline in turnover test in each of the previous 3 quarters, in order to remain eligible for the March 2021 quarter.
New Reduced, JobKeeper Payment Rates based on average hours of work
Whilst the current JobKeeper payments will remain unchanged until 27 September 2020 ($1,500 per fortnight per eligible employees), this will be reduced on and from 28 September 2020, with 2 tiers of payments, as follows:
From 28 September 2020 to 3 January 2021:
$1,200 per fortnight per eligible employee who, in the 4 weeks before 1 March 2020, were working in the business for 20 hours or more a week on average, and for business participants who were actively engaged in the business for more than 20 hours per week; and
$750 per fortnight for eligible employees who were working in the business for less than 20 hours a week on average and business participants who were actively engaged in the business less than 20 hours per week in the same period.
From 4 January to 28 March 2021:
$1,000 per fortnight for all eligible employees who, in the 4 weeks before 1 March 2020, were working for 20 hours or more a week on average, and for business participants who were actively engaged in the business for more than 20 hours per week; and
$650 per fortnight for employees who were working for less than 20 hours a week on average, and business participants who were actively engaged in the business for less than 20 hours per week in the same period.
What do businesses need to consider?
Business should therefore start planning ahead, to the extent possible with this uncertain crisis, and factor in the reduction of support from the JobKeeper scheme into their business decisions. At this stage, we are just awaiting confirmation as to whether the temporary provisions of the Fair Work Act 2009 (Cth) that support the JobKeeper scheme will be extended past 28 September 2020. We will issue an update once this has been confirmed.
If you need urgent advice or assistance in managing the impact of the COVID-19 crisis in your workplace, please contact IR Legal Solutions to discuss.
This content is not be a substitute for legal advice and is for information only. Employers should obtain advice that is specific to their circumstances and business operations, and not rely on this publication as legal advice.