COVID-19 JobKeeper Payment

As many of us own, operate or work within a small/medium business setting, the new JobKeeper payment announcement has brought some confidence back into a stalling economy. The Federal Government has announced a new $130bn support package with a new JobKeeper payment – a wage subsidy to keep Australians in work.

How much is the payment worth?

The Federal Government will pay eligible employers $1,500 per fortnight for each eligible worker, about 70% of the national median wage.

JobKeeper is about $400 a fortnight more than the $1,100 JobSeeker payment with the coronavirus supplement for those out of work.

Who is eligible for JobKeeper?

In order to receive a payment, both the employer and employee must meet eligibility criteria.

Eligible employers are businesses (including companies, partnerships, trusts and sole traders), not-for-profits and charities:

  • With a turnover of less than $1bn that have lost 30% or more of their revenue compared to a comparable period a year ago
  • With a turnover of $1bn or more and with at least a 50% reduction in revenue compared to a comparable period a year ago
  • Not eligible to the banking levy

Eligible employees:

  • Were employed by an eligible employer at 1 March 2020
  • Can be sole traders, full-time, part-time, or long-term casuals employed on a regular basis for longer than 12 months as at 1 March 2020.
  • Are at least 16 years of age
  • Are an Australian citizen, the holder of a permanent visa, a protected special category visa, a non-protected special category visa who has been residing continually in Australia for 10 years or more, or a New Zealander on a special category (subclass 444) visa

The government estimates that six million workers will receive this payment. Gig economy workers will be covered, as they are sole traders.

What if I am on a temporary visa?

Scott Morrison explained that New Zealanders on 444 visas will get the payment because “they are part of an ongoing economy in Australia”.

Eligibility may be expanded to others, but at the moment many temporary visa holders will be ineligible.

How will it be paid?

Eligible employers will be paid $1,500 per fortnight per eligible employee from 30 March 2020, for a maximum of six months.

Eligible employees will receive from their employers a minimum of $1,500 per fortnight, before tax. Employers can top up the payment.

Employers will pay employees as usual and payments will be made to the employer monthly in arrears by the Australian Tax Office.

Will I receive $1,500 even if I ordinarily earn less?

If an employee ordinarily receives less than $1,500 in income per fortnight before tax, their employer must pay them, at a minimum, $1,500 per fortnight, before tax. It is therefore possible for a long-term casual or part-time worker to receive more than their ordinary pay.

What if I was stood down or sacked?

If an employee has been stood down, their employer must pay their employee, at a minimum, $1,500 per fortnight, before tax.

This means that employees of businesses that shut down due to various restrictions – such as cafes, restaurants, theatres, casino workers and the like – will continue to be paid even if they are not working.

If an employee was employed on 1 March 2020, subsequently ceased employment with their employer, and then has been re-engaged by the same eligible employer, the employee will also receive, at a minimum, $1,500 per fortnight, before tax.

When will it start being paid?

The subsidy will start on 30 March, with the first payments to be received by employers in the first week of May. In the meantime, employers must continue paying their employees and then claim the money from the first week of May.

Businesses are able to register their interest in participating in the payment on the ATO website.

What about superannuation?

Employers must continue to pay the superannuation guarantee on regular wages, but it is up to employer whether they pay superannuation on additional JobKeeper payments.

Can I get the JobKeeper and other payments?

A person receiving the JobKeeper payment cannot also receive the JobSeeker payment (formerly Newstart). People who have already applied for JobSeeker can withdraw and shift to JobKeeper payments if they are re-engaged by their employer.

A person cannot be in receipt of JobKeeper payments from two or more employers.

We’ll keep our eyes out for more information as it’s published.

For now, the ATO is a good source of information for those affected by Covid-19.

Fact sheets

Fact sheet for employers for Employers

Fact sheet for employers for Employees

Fact sheet supporting businesses