News & Insights

On 21 July 2020 and 7 August 2020 respectively, the Australian Federal Government announced the extension to the JobKeeper scheme for an additional six months until 28 March 2021, and in response to the tighter lockdown restrictions imposed on Victoria announced a number of major changes to the JobKeeper scheme.

current JobKeeper scheme

Since the scheme commenced on 30 March 2020, it has provided qualifying employers financial assistance in the form of a subsidy. The subsidy is currently $1,500 per fortnight for each eligible employee.

To be eligible for the initial JobKeeper payment, an employer must show that:

• It has experienced a decline in turnover of either 15%, 30% or 50% depending on the entity type and aggregated turnover for the income year; and
• An employment relationship existed between the employer and eligible employee/s as at 1 March 2020.

future JobKeeper scheme

At the time of announcing the extension to the JobKeeper scheme, the Australian Government also provided details of what the JobKeeper scheme will look like beyond September 2020.

The Australian Government announced a tiered system to the fortnightly JobKeeper subsidy, as follows:

• From 28 September 2020:
  • • $1,200 per eligible full-time employee; and
    • $750 per eligible employee working less than 20 hours a week.
• From 4 January 2020, the fortnightly JobKeeper wage subsidy will be further reduced to:
  • • $1,000 per eligible full-time employee; and
    • $650 per eligible employee working less than 20 hours a week.

Significantly, there are also changes to the eligibility requirements:

• Business turnover test, from 28 September 2020:
  • • the testing period for eligibility has been revised so that only the quarter ending 30 September 2020 is relevant (rather than both the June and September 2020 quarters) for the first extension period.
    • Similarly, the testing period to continue with JobKeeper past 31 December 2020 (the second extension period) only now requires testing of the quarter ending 31 December 2020 (rather than all three of the June, September and December 2020 quarters).
• Eligible employee test, from 3 August 2020:
  • • the previous employee cut-off date of 1 March 2020 has been replaced by 1 July 2020, meaning:
      • employees that commenced employment between 1 March 2020 and 1 July 2020 will be eligible employees for JobKeeper purposes; and
      • individuals that became an Australian permanent resident between 1 March 2020 and 1 July 2020 will now be eligible for JobKeeper (subject to meeting the other eligibility criteria).

what do businesses need to do?

Businesses currently enrolled in the scheme can rest assured they will continue to receive the Government subsidy until (at least) 28 September 2020, without being required to do anything different. For those organisations not currently enrolled, the scheme remains open to new applicants including those that can satisfy (perhaps for the first time) the changed eligibility requirement.

Given that the JobKeeper scheme operates on a “one-in, all-in” system and the changes apply to the existing scheme, it would seem that businesses will be required to meet the existing legislated requirements including the wage condition – that is eligible employees should receive $1,500 per fortnight commencing from 3 August 2020.

we are here to help

If you are an employer and are concerned about your eligibility for JobKeeper 2.0, want to better understand the implications the amendments may have on your business or require advice issuing a JobKeeper enabling direction, please contact our Employment, Safety and Migration team.