In late July 2020, the Federal Government announced an extension to the JobKeeper measure beyond its 27th September 2020 conclusion date, with further measures announced in light of the recent COVID19 restrictions imposed in Victoria. At present, we are awaiting legislation to enact these changes.
To be eligible for JobKeeper from 28th September 2020, the government has set out following additional criteria:-
- The decline in turnover test is required to be re-tested on a quarterly basis;
- The decline in turnover test is based on actual GST turnover rather than projected turnover;
- Employees may qualify for JobKeeper if they were eligible employees at 1st July 2020 (previously 1st March 2020).
- A two-tier payment rate based on the eligible employee’s or business participant’s average working hours per week;
- The current $1,500 per fortnight payment rate will be reduced on 28th September 2020, and then reduced further on 4th January 2021 until 28th March 2021.
What does it mean for business owners?
Employers should identify any employees who may have missed out on JobKeeper because they were not employed on 1 March 2020, as they may now qualify for JobKeeper from 3rd August 2020. This could potentially capture newly hired employees, and long-term casuals who have been regularly and systematically employed for at least 12 months at 1st July 2020. If you have employees impacted by this change, you will still need to work through the eligibility requirements, including providing JobKeeper Payment Employee Nominations and meeting the wage condition, but just remember that these changes are not yet law.
Employers should also consider the following action steps as we move towards this second phase of JobKeeper.
- Re-test the decline in turnover test: maintain good and timely records to determine whether the decline in turnover test has been satisfied on an ongoing basis.
To be eligible for the JobKeeper extension for the period from 28th September 2020 to 3rd January 2021, employers will need to compare the actual GST turnover for the September quarter only.
To be eligible for the JobKeeper extension for the period 4th January 2021 to 28th March 2021, employers will need to compare the actual GST turnover for the December quarter only.
- Identify additional eligible employees on 1st July 2020: more employees may now qualify for JobKeeper, including newly hired employees, and long-term casuals who have been regularly and systematically employed for at least 12 months at 1st July 2020.
- Determine the type of worker: employers should assess if employees worked 20 hours or more per week on average in either the four weeks of pay periods before 1st March 2020 or 1st July 2020 (whichever is applicable). Similarly, business participants should consider how they can ascertain hours actively engaged in their business for the month of February 2020 or June 2020.
- Meet the wage condition: pay the eligible employees according to the new rates of JobKeeper depending on whether they are full-time or part-time employees.
Under the new arrangements, the following reduced JobKeeper rates will apply, depending on the classification of the worker as explained above, being either full-time (ie 20 hours or more) or part-time (less than 20 hours):-
For the period from 28th September 2020 to 3rd January 2021:
• $1,200 per fortnight for full-time employees;
• $750 per fortnight for part-time employees
For the period from 4th January 2021 to 28th March 2021:
• $1,000 per fortnight for full-time employees;
• $650 per fortnight for part-time employees
The RDL JobKeeper team is able to assist you in ensuring that you correctly assess and maximise your entitlement to this stimulus payment.