The economic impacts of COVID-19 (coronavirus) pose significant challenges for many businesses – many of which are struggling to retain their employees. On Monday the Government announced a $130 billion package to support around 6 million Australian workers.
Under the JobKeeper Payment, businesses significantly impacted by the COVID-19 outbreak will be able to access a subsidy from the Government to continue paying their employees. This assistance will help businesses to keep people in their jobs and re-start when the crisis is over.
The Government will provide employers a payment of $1,500 per eligible employee from 30 March 2020, for a maximum 6 months.
The flat $1,500 payment, which will be delivered by the ATO, will be paid to businesses, including businesses structured through companies, partnerships, trusts and sole traders.
Employers will be eligible for the subsidy if:
- their business has a turnover of less than $1 billion and their turnover will be reduced by more than 30 per cent relative to a comparable period a year ago (of at least a month), or
- their business has a turnover of $1 billion or more and their turnover will be reduced by more than 50 per cent relative to a comparable period a year ago (of at least a month), and
- the business is not subject to the Major Bank Levy
- The employer must have been in an employment relationship with eligible employees as at 1 March 2020, and confirm that each eligible employee is currently engaged in order to receive JobKeeper Payments.
- Not-for-profit entities (including charities) and self-employed individuals (businesses without employees) that meet the turnover tests that apply for businesses are eligible to apply for JobKeeper Payments.
Eligible employees will include those employed by the employer at 1 March 2020, including those who have been stood down. Retrenched workers can be re-hired to qualify for the payment.
Employers can register their interest in applying for the JobKeeper Payment via The Australian Taxation Office (ATO) from 30 March 2020. The ATO will make payments to the employers monthly in arrears but the first payment will be sent in the first week of May and will be backdated to 30 March 2020 to allow employers to start paying their workers now.
Employers will be required to report the number of eligible employees employed by the business to the ATO on a monthly basis.
For more information click on the fact sheet.
If you would like to discuss the COVID-19 wage subsidy in more detail please contact us.
Disclaimer: This news post is intended to provide a general summary only; the information is not legislation and it is subject to change and should not be relied on as a substitute for professional advice.