30/03/2020

The Prime Minister has today announced a JobKeeper wage subsidy of $1,500 per fortnight for eligible employees of businesses which qualify for the subsidy.

The JobKeeper payment will be paid by the Federal Government to businesses to subsidise the wages of their eligible employees.  These businesses will be able to claim the payment for 6 months from 30 March 2020.  Employers will need to register with the Australian Taxation Office to receive the subsidy.

Businesses that qualify for the subsidy

Businesses whose turnover is affected by the covid-19 pandemic will be eligible to receive the wage subsidy for their eligible employees.  An eligible business will be:

  • businesses with a turnover of less than $1 billion, where the turnover has decreased by at least 30%; and
  • for all other businesses, the turnover has decreased by at least 50% or more.

The timeframe over which the decrease in turnover is assessed is a period of at least one month compared to 12 months ago. 

Eligible employees

Employees will be eligible to receive the JobKeeper payment from their employer if they:

  • were employed by an eligible business as at 1 March 2020 (even if their employment was terminated after that date but they’re subsequently re-employed); 
  • are employed on either a full-time, part-time or casual basis (provided that casuals have been employed for at least 12 months); and
  • meet residency requirements. The Federal Government has advised that this will include Australian citizens, permanent visa holders, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder.

An employee will be eligible to receive the JobKeeper payment whether or not they are stood-down or continuing to perform their duties.  The Federal Government has announced that even if an employee is earning more than $1500 per fortnight as normal income, their income will be subsidised by $1500 per fortnight.  Employees whose normal income is less than $1500 per fortnight will also be paid the full subsidy.  

There will be no obligation on employers to make superannuation contributions in respect of the JobKeeper payment.  This means that for employees whose JobKeeper payment is greater than their income, they will be entitled to superannuation on their income as normal but they will not be entitled to superannuation on the difference.  However, employers may decide to pay superannuation on the difference if they wish. 

For employees whose income is equal to (or greater than) their JobKeeper payment, they will be entitled to superannuation on their income as normal. 

The Federal Government has released information which says that employees will have the following obligations in respect of the JobKeeper payment:

  • employees with multiple employers must notify the employer who is their primary employer;
  • non-Australian citizens must notify their employer of their visa status for the purpose of the employer to determinine if they are eligible to receive the JobKeeper payment; and
  • employees must notify Services Australia of their new income if they are currently receiving an income support payment.

Implementation of the subsidy

The Prime Minister has announced that legislation giving effect to the JobKeeper payment will be drafted this week.  Federal Parliament is expected to be re-called to pass the legislation.

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