JobKeeper $1500 wage subsidy passes parliament into law

The $130 billion JobKeeper wage subsidy scheme passed federal parliament overnight with eligible business owners to receive the $1500 per fortnight payment per staff member in the first week of May, backdated to March 30 for the next six months.

To be eligible for JobKeeper businesses with a turnover of less than $1 billion a year need to have lost up to 30 per cent of income due to the coronavirus pandemic, while businesses earning over $1 billion a year need to have lost up to 50 per cent of income.

The scheme is being managed through the Australian Taxation Office and eligible businesses should apply here  and nominate relevant employees. The business owner is then required to pay staff with the government reimbursement not due to them until the first week of May.

The scheme is also linked to a mandatory code which applies to commercial landlords and tenants and operates on “good faith” leasing principles. The code requires landlords to engage with commercial tenants and reduce rent in proportion to the downturn being experienced by a business during the coronavirus.

JobKeeper applies to full-time, part-time and casual employees that have worked for the business for longer than 12 months. If an employee was stood down due to COVID-19 prior to the JobKeeper scheme’s announcement that employee can be re-engaged by the employer and linked to the scheme. It also applies if a business is hibernating and the employee is not required to actually come to work.

Employees can not access both JobKeeper and JobSeeker payments.

Many printers have expressed concern about how to to cover wages for the four week period before the reimbursements flow through with many losing up to 60 per cent of work due to the coronavirus.

In answer to this Treasurer Josh Frydenberg has advised business owners to approach their bank for an extended line of credit to cover the gap period of time.

Wayne Eastaugh, the owner of Melbourne bindery Marvel Bookbinding, said he had applied for the scheme but was concerned for business owners out there that will struggle to meet the wage payments in the interim as work has decreased dramatically for many in print.

“The only concern I can see out of JobKeeper is they are recommending that you need to pay the money up front and then you get it back. I think there will be a lot of businesses that are not going to be in a financial position to do that,” Eastaugh told Sprinter.

Equally it would be difficult for many business operators to get a sufficient line of credit from the bank to cover the wage bill.

“It is also difficult as we haven’t been told if we definitely qualify. You don’t know until you get it so if you have got staff sitting at home not working and you’re paying them and then you don’t get JobKeeper then you are left out of pocket. I think there is a few grey areas that need to be tidied up on it.”

The Real Media Collective CEO Kellie Northwood said the Collective will now work with its membership, through a daily bulletin and webinars with IR general manager Charles Watson, to ensure members can access the much needed support.

“Our members range in size from less than $1m turnover to $10-20m turnover and then the over $50m businesses, these initiatives from Government have differing impacts across our members and broader industry, because of this it’s important we work through the details to ensure we can provide clarity for members and a strong voice for industry,” Northwood said.

“Our particular focus for small to medium businesses has been the percentage decline in downturn for JobKeeper eligibility requirements as this also links to the commercial tenancies code of conduct. Given many printers produce and invoice work in March preparing for a very short month in April, the detailed clarification of the ‘has or will’ turnover declines across the period is of particular interest to the Collective and will be our focus over the next twenty-four (24) hours to assist our members in best preparing themselves for this eligibility as we know it will be one of great assistance to our members.”

The RMC also announced this morning, members will be provided a webinar briefing from Charles Watson, GM – IR, Policy and Governance, with an industry insight into JobKeeper, Fair Work Commission Award variations and the additional Government announcements from this week.

In a ministerial address to federal parliament yesterday, Prime Minister Scott Morrison said:

“Today, we will put before the Parliament our JobKeeper package. JobKeeper will keep Australians in jobs and it will keep the businesses that employ them in business, both now and into the future. The $130 billion economic life-line will provide payments of $1,500 per fortnight to an estimated six million eligible workers through their employer.

“As of yesterday afternoon over 700,000 businesses have registered for this support, and this number continues to grow. It is the equivalent, this payment, of around 70 per cent of the national median wage. For workers in accommodation, hospitality and retail services, some of the most affected by this economic crisis, it equates to a full median replacement wage.”

Comment below to have your say on this story.

If you have a news story or tip-off, get in touch at [email protected]  

Sign up to the Sprinter newsletter

One thought on “JobKeeper $1500 wage subsidy passes parliament into law

  1. The legislation is passed, but ATO is still working through the implementation processes. My information from ATO is that it will be at least a week before they are ready – well in time for the first payments which are due in early May.

    Meanwhile, businesses should continue to manage payroll as they did last week.

    Updates will be available through Certified Bookkeepers among others finance professionals.

    It is not a simple process – there are a number of considerations.

    .

Leave a comment:

Your email address will not be published. All fields are required

Advertisement

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.
  • This field is for validation purposes and should be left unchanged.
Advertisement