Further to previous QHA Bulletins about the Federal Government’s JobKeeper Payment scheme, please click HERE to access the QHA’s JobKeeper Q&A Information Guide (‘Guide’).
This edition of the Guide is current as at today’s date, and will be updated regularly as new information / details of the scheme are made available.
Late yesterday the Australian Tax Office released further information clarifying a number of elements of the scheme. You can access this information HERE.
Below is a summary of key information for employers along with information to assist in dealing with employee queries on the scheme.
- As previously advised, payments from the ATO back to the business participating in this scheme will not be made until the first two weeks in May. This lag time in repayments will continue throughout the course of the scheme.
Members must bear this in mind in determining whether they wish to participate in the scheme.
We strongly recommend you speak to your accountant and/or your bank in the event that you may need to consider options to assist managing cash flow while operating the scheme.
2. Participation in the scheme is based on a “one-in, all-in” requirement. Accordingly, if the business wishes to receive the benefits of the wage subsidy in respect of employees that are currently still working (or taking accrued leave), then it must opt in to the scheme in respect of all eligible employees (including employees who have been stood down but remain employed).
The benefits of the scheme may be limited in current circumstances where no employees are actively engaged at the current time but will likely increase at a future point when trading restrictions are eased and you look to re-engage your labour force that has been stood down.
3. You do not need to opt in to the scheme immediately. You can do so at any point in the course of the six month period of operation of the scheme. For those members for whom the scheme is not a viable option at the present time, this may be a relevant consideration in terms of delaying participation in the scheme.
Again, we recommend you seek professional financial advice around the viability of participating in the scheme, whether that is commencing immediately or at some later date.
4. Subject to eligibility requirements, you may be eligible as a business owner/operator/sole trader – you are potentially eligible to claim up to $19,500 over the six months of the scheme.
Summary of the Scheme
The government has introduced a $130 billion JobKeeper Payment scheme to support businesses significantly affected by the coronavirus to encourage the maintaining of an employment relationship between employers and employees.
The JobKeeper payment is open to eligible employers to enable them to pay their eligible employee’s salary or wages of at least $1,500 (before tax) per fortnight.
Eligible employers will be reimbursed a fixed amount of $1,500 per fortnight for each eligible employee.
Employers will need to pay eligible employees a minimum of $1,500 (before tax) per fortnight to claim the JobKeeper payment. This will be paid to the employer in arrears each month by the ATO. The first payments to eligible employers will commence in the first week of May 2020 (but may take up to two weeks after this date). JobKeeper payments can be made for the period beginning 30 March 2020.
If employers do not continue to pay their employees for each pay period, they will cease to qualify for the JobKeeper payment. The first fortnight is from 30 March – 12 April and each JobKeeper fortnight follows after that.
For the first two fortnights (30 March – 12 April, 13 April – 26 April), the ATO will accept the minimum $1,500 payment for each fortnight has been paid by you even if it has been paid late, provided it is paid by you by the end of April. This means that you can make two fortnightly payments of at least $1,500 per fortnight before the end of April, or a combined payment of at least $3,000 before the end of April. In this instance employers will be reimbursed by the Government for all April expenditure by 14 May.
This will continue until the end of the scheme, which is scheduled for 6 months after commencement.
To be eligible for the JobKeeper payment, employers and their employees must meet a range of criteria. Please refer to the QHA’s Q&A Information Guide for those details.
We are aware that employees have been contacting members questioning why payments have not been commenced under the scheme. You should explain to employees that participation in the scheme is subject to meeting a range of eligibility criteria and this will be determined in the coming weeks.
Employees will also need to complete the relevant form to be eligible to participate in the scheme and that form has only been made available by the ATO this afternoon.
The AHA has developed two template letters which we recommend that you issue to your employees – based on your decision to participate or not. The letters are :
1. In the event that you intend to participate in the scheme, this letter contains a link to the form that employees are required to complete and return to you to register their intention to participate. Download it HERE.
2. In the event that you do not intend to participate in the scheme, this letter provides suggested wording to notify employees to this effect. Download it HERE.