Everything you need to know as an employer; from applying through to receiving JobKeeper payments.
So, What Exactly is The JobKeeper Payment?
Any business who has been affected by Coronavirus and fits the eligibility criteria (we will go over this below), will be able to access a subsidy from the Government in order to keep paying their employees. Affected employers will be able to claim a fortnightly payment of $1,500 for each eligible employee as of 30th March 2020, for up to 6 months!
If you’re a business who has had to close its doors, this will help you to keep your team in a job and re-start with the same great team when the crisis is over, while your employees receive $750/week. Win-Win, it gives your employees job security and an income during these uncertain times. For you, it means you don’t have to lose your hardworking team and need to build from the ground up when you re-open.
In the meantime, you might have some other tasks for your team that they can complete while the doors are closed, making it affordable for you to do so with the government subsiding your employee wages.
If your business is still running, it means you can continue to keep your workforce on board, even if the business has started to slow down. With the Government subsidising a fair chunk of your business wages, it will ease the pressure on you, allow you to look after your employees, and drastically improve your business cash flow.
Is My Business Eligible?
Your business must meet certain criteria in order to be eligible for this support, after all, the Government can’t be throwing around money without having some clear black & white rules about where the money goes. So… what are the criteria?
Your business has a turnover of less than $1 billion and your turnover will be reduced by more than 30% relative to a comparable period a year ago (of at least a month), or
Your business has a turnover of $1 billion or more and that turnover will be reduced by more than 50% relative to a comparable period a year ago (of at least a month); and
Your business is not subject to the Major Bank Levy.
Not-for-profits (including charities), and self-employed individuals (businesses without employees/sole traders) that meet the turnover tests mentioned above are also eligible for JobKeeper Payments.
Which Employees Are Eligible
Just like the business criteria, your employees must meet the criteria as well. Eligible employees are those that:
Are currently employed by you (including people who have been stood down or re-hired),
Was an employee for you at 1st March 2020,
Are a full-time, part-time, or long term casual (any casual employed on a regular basis for longer than 12 months as at 1st March is eligible),
Are at least 16 years of age,
Are an Australian citizen, the holder of a permanent visa, 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, and
Are not receiving the JobKeeper Payment from another employee.
Alrighty, So You're Eligible - Now What?
Step One - Enrol for the JobKeeper Payment
For businesses with employees, you can enrol for the JobKeeper Payments through the ATO’s Business Portal, or through a registered tax or BAS agent (which is where we can help you!)
If you are a sole trader you can apply through the ATO online service using your myGov account.
You must pay each eligible employee a minimum of $1,500 (before tax) per fortnight to claim the JobKeeper Payment, and continue to make those fortnightly payments. You will then be paid in arrears each month by the ATO. You will receive your first payment in the first week of May 2020. Your employees can receive JobKeeper payments from the period beginning 30th March 2020.
The first JobKeeper fortnight was the period from 30th March to 12th April. If you do not continue to pay your employees for each pay period, they will cease to qualify for the JobKeeper payment.
You must notify all your eligible employees that you are intending to claim the JobKeeper payment on their behalf and check that they aren’t claiming it through another employer.
Send the JobKeeper employee nomination notice to all your nominated employees to complete and return to you by the end of April.
Step Two - Identify & Maintain Your Eligible Employees
You or your registered tax/BAS agent must identify each eligible employee that you will claim the JobKeeper Payment for and maintain their details each month.
You can use your Single Touch Payroll Software if you have updated it with the JobKeeper functionality.
You can use the Business Portal if your Single Touch Payroll isn’t updated with the JobKeeper functionality.
If you don’t have Single Touch Payroll Software, you can identify your employees through the ATO Business Portal.
Step Three - Make a Business Monthly Declaration
It’s important that you reconfirm your reported eligible employees each month. This can be done using the instructions above through the ATO Business Portal or with your registered tax/BAS agent.
If your eligible employees change or leave employment, you must notify the ATO through the monthly declaration report.
You are also obligated to provide information as to your current and projected GST turnover. This isn’t to retest your eligibility but instead to indicate how your business is progressing under the JobKeeper Payment Scheme.
Paying Your Eligible Employees
Let's clear up some information here as a lot of businesses seem to be getting confused around the payments to their employees and dates they need to have this done by.
You must pay your eligible employees at least the minimum amount of $1,500/fortnight (before tax), even if you re-hire them or they usually earn less than this per fortnight.
You cannot pay your employee less than $1,500 per fortnight and keep the difference for yourself.
If your eligible employees earn more than $1,500 per fortnight, you should continue to pay them their regular salary or wages if you can. However, you will only receive $1,500 for each eligible employee. Any amount you pay about $1,500 is not subsidised by the JobKeeper Payment.
You will not be eligible for the JobKeeper payment if you pay your nominated employee less than $1,500 per fortnight.
The JobKeeper Payment scheme works on a fortnightly basis. The first fortnight was 30th March - 12 April, and each fortnight continues from there. To be eligible for payment from the ATO you MUST pay your eligible employees the $1,500 per fortnight for each JobKeeper fortnight you plan to claim.
For the first two fortnights of the JobKeeper Payment scheme (the month of April), the ATO will accept the minimum $1,500 payment for each fortnight that has been paid, even if it has been paid late. As long as you have made payment to the employee before the 8th of May. This means each eligible employee must be paid a minimum of $3,000 for the month of April in order for you to be paid in arrears.
Final Note
We understand that every business is unique in itself. However, if you follow these rules and instructions you should be able to apply and receive JobSeeker Payments. If you are having any trouble navigating the application process or keeping your employee information up to date through the Business Portal, please don’t hesitate to call us, we are here to help. Of course, for our clients, we are here to ease the pressure and get this sorted for you so please get in contact with us ASAP so we can work through the process together.
Most importantly, if you want to be eligible for the payments, please ensure each eligible employee is paid the $3,000 minimum for the month of April. Let’s focus on getting that sorted first and then we can work through any other challenges together.
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Stay healthy & safe!
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