The JobKeeper Payment will help businesses affected by the coronavirus cover the costs of their employees’ wages, help more people to retain their jobs and continue to earn an income. The scheme involves the Australian Government paying employers a wage subsidy at a flat rate of $1,500 per employee per fortnight for up to six months. The JobKeeper Payment will be backdated to 30 March 2020 for employers who register by 31 May 2020 for JobKeeper fortnights in April and May 2020. Employers who register after 31 May 2020 will receive JobKeeper Payment on a prospective basis.
There is no cap on the number of employees eligible for the subsidy. This amount is equivalent to around 70% of the Australian median wage and in the accommodation, hospitality and retail industries, it is equivalent to the full median wage.
Employers with turnover of less than $1 billion are eligible if they experience at least a 30% decline in revenue since 1 March in a month versus the prior year. Businesses with annual turnover of $1 billion or more are eligible if their turnover falls by more than 50%.
Employers must apply to the Australian Taxation Office (ATO) to participate in the scheme and provide supporting information demonstrating the impact felt in their business. Employers will also need to continue to report to the ATO the number of eligible employees employed by their business each month.
Self-employed individuals (businesses without employees) that meet the turnover tests that apply for employers are eligible to register one person, who is actively engaged in operating the business, for JobKeeper Payments. Eligible individuals include a sole trader, partner in a partnership, beneficiary of a trust and a director or shareholder of a company.
Charities that are registered with the Australian Charities and Not-for-Profits Commission (other than a school or university) will be eligible for the JobKeeper Payment if they have suffered a 15 per cent decline in turnover as a result of the coronavirus. This measure is to support a sector which is expected to have a significant increase in demand for its services. Schools and universities are subject to turnover tests noted earlier.
Employers will receive the payment for each eligible employee (employed at 1 March 2020) who continue to be employed. This includes full-time and part-time employees, casuals with regular service in the 12 months prior to 1 March 2020, and stood down employees. Employees who have been stood down since 1 March can also be re-engaged and receive the wage subsidy. Self-employed business owners will be eligible to receive the JobKeeper Payment where they have suffered or expect to suffer a 30 per cent decline in turnover relative to a comparable prior period (of at least a month).
The Government has announced its intention to end JobKeeper support on 20 July 2020 for employees of a Child Care Subsidy approved service and sole traders operating a child care service.
To be an eligible employee, the individual will need to be at least 16 years old on 1 March 2020 and satisfy an Australian residency requirement.
Individuals receiving parental leave pay or paid dad and partner pay will not be eligible for a JobKeeper Payment for any fortnight they are entitled to these payments.
Payments will be made to employers by the ATO after the end of the calendar month, with the first payments to be received in the first week of May.
Register via the ATO website: Enrol for the JobKeeper payment
Australian Government Fact Sheet: JobKeeper Payment - Information for Employers
ATO Law Companion Ruling 2020/1: JobKeeper payment – decline in turnover test
ATO guidance regarding time: JobKeeper key dates