The JobKeeper Payment is a wage subsidy designed to support workers and businesses during the COVID-19 crisis. Under JobKeeper, registered employers receive fortnightly payments of $1500 per eligible worker. This payment is to cover the cost of wages and keep workers employed during the crisis.
The Federal Government introduced JobKeeper after a hard-fought campaign from the Australian union movement. Thanks to this campaigning effort, millions of workers have stayed employed despite the economic impact of the COVID-19 crisis. Moving forward, JobKeeper needs to be extended and expanded to include workers excluded from the scheme. The Australian union movement continues to fight to keep people in work and keep money in the hands of the working people.
What businesses are eligible for JobKeeper?
The JobKeeper Payment scheme aims to support businesses and not-for-profits that have been significantly impacted by the COVID-19 crisis.
The following employers are eligible for JobKeeper:
- A business or not-for-profit with turnover of less than $1 billion that can prove a decline in turnover of 30% or more
- A business or not-for-profit with turnover of more than $1 billion that can prove a decline in turnover of 50% or more
- An Australian Charities and Not-for-profits Commission registered charity that can prove a 15% or greater decline in turnover.
Some businesses may not have previously met the threshold but now meet the threshold due to the shutdown. These businesses can now apply to receive the subsidy.
In order to be eligible for the month of August, they must apply and identify eligible employees by 31 August.
Businesses will have to declare that they meet the loss threshold for the current month on enrolment and then prove that in their monthly statement in the following month (which covers the previous month). For example, an employer signing up for August today will have to:
- declare that their August turnover will meet the threshold and
- prove they meet the threshold when they submit their August statement in September.
Payments to employers are made in arrears monthly, so employers would pay for the August payments to their staff and then receive the money back from the ATO in September.
Some businesses are not eligible for JobKeeper. These are:
- Any banking institution that was subject to the Major Banking Levy Act 2017
- Government agencies, local government bodies or entities wholly owned by entities of those types
- Companies which have had liquidators or provisional liquidators appointed.
Which workers are eligible for JobKeeper?
Once an employer has registered for JobKeeper, they must pass on the payment to all eligible workers – this is the ‘one-in, all-in’ rule. Unfortunately, not all workers are included in the wage subsidy scheme.
To be eligible for JobKeeper, you must:
- Be employed on 1 March 2020. (casuals only: must have been employed for 12 months on a regular and systematic basis as of 1 March)
- Be 16 years or older as of 1 March 2020
- Be an Australian citizen, the holder of a permanent visa, or a Special Category (Subclass 444) Visa Holder (New Zealand) at 1 March 2020
- Be employed at some point during a “JobKeeper Fortnight” (any fortnight beginning with the fortnight on 30 March 2020).
Under the current scheme, the following workers are not eligible for JobKeeper:
- Casuals with less than 12 months experience
- Temporary visa workers (except for Subclass 444 for New Zealanders)
- Workers receiving parental leave pay
- Workers who are totally incapacitated and receiving workers compensation.
Australian Unions are working to expand eligibility to cover more workers. , including childcare and early educators as well as casuals.
Chat to your union or the Australian Unions Support Centre if you have any questions about your JobKeeper eligibility.
How do I get paid under JobKeeper?
Once your employer has registered for JobKeeper with the ATO, they will receive $1,500 per fortnight for every eligible worker. Your employer must then pay all eligible workers the higher of:
- $1,500 (before tax) per fortnight or
- Their normal earnings for the fortnight (for work actually performed)
This means, you must receive a minimum of $1500 (before tax) per fortnight. If you are still working and would normally earn more than this, your pay and superannuation does not change.
The current payment rate will soon be changing. From 28 September 2020, the fortnightly payment will reduce to $1,200 per fortnight (before tax). Lower payment rates will also apply for those who work fewer hours per week. See ‘What is the JobKeeper Extension?’ for more information on changes to JobKeeper.
Superannuation is only paid for hours worked. For example, if you received $1000 for work performed in a fortnight and received a further $500 to meet the $1500 minimum, you would receive superannuation on the $1000 only.
Annual leave accrues as normal when you are receiving JobKeeper payments, even if you have been stood down from work.
Chat to your union or the Australian Unions Support Centre if you have any concerns about your pay under JobKeeper.
What is the JobKeeper Extension?
After strong campaigning from the union movement, the Federal Government has extended and expanded the JobKeeper Payment scheme for a further six months from Sept 28, 2020 to March 2021.
As part the extension, eligibility will be loosened but payment amounts will be reduced. Key changes are detailed below.
Business changes
Some changes have been made to the eligibility criteria for businesses and not-for-profits as follows:
- Eligibility will be based on actual GST turnover in the September quarter 2020 to be eligible from 28 Sept 2020 – 3 Jan 2021
- Eligibility will be based on actual GST turnover in the December quarter 2020 to be eligible from 4 January 2020 – 28 March 2021
- Eligibility will be based on the following the following decline in GST turnover:
- A 50 per cent decline of turnover for those with aggregated turnover of more than $1 billion
- A 30 per cent decline of turnover for those with an aggregated turnover of $1 billion or less
- A 15 per cent decline of turnover for Australian Charities and Not for profits Commission-registered charities (excluding schools and universities)
Employee changes
Some changes have been introduced to who is eligible for the JobKeeper payments during the extension period.
To receive JobKeeper payment after 28 September 2020, you must be:
- Currently employed by an eligible employer (including if you were stood down or re- hired)
- A full-time, part-time or fixed-term employee at 1 July 2020; or
- A long-term casual employee (employed on a regular and systematic basis for at least 12 months) as at 1 July 2020 and not a permanent employee of any other employer
- were aged 18 years or older at 1 July 2020 (if you were 16 or 17 you can also qualify if you are independent or not undertaking full time study)
- Either:
- an Australian resident (within the meaning of the Social Security Act 1991); or
- An Australian resident for the purpose of the Income Tax Assessment Act 1936 and the holder of a Subclass 444 (Special Category) visa as at 1 March 2020.
- Not receiving any of the following payments during the JobKeeper fortnight:
- government parental leave or Dad and partner pay under the Paid Parental Leave Act 2010; or
- a payment in accordance with Australian worker compensation law for an individual's total incapacity for work.
As well as changes to eligibility, payment amounts will change under the extension period. The rate will be reduced and a lower payment rate will be introduced for those who work fewer hours.
From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:
- $1,200 per fortnight for all eligible employees who were working in the business or not- for-profit for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average; and
- $750 per fortnight for other eligible employees and business participants.
From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:
- $1,000 per fortnight for all eligible employees who were working in the business or not- for-profit for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for business participants who were actively engaged in the business for 20 hours or more per week on average; and
- $650 per fortnight for other eligible employees and business participants.
The expansion is a good step forward to bringing some financial security to the thousands of workers facing an uncertain future, but it does not go far enough. Australian Unions continues to push for JobKeeper to be further expanded to fully cover the casuals and visa workers left out from the scheme.
The difference between JobKeeper and JobSeeker
JobKeeper is a different payment to JobSeeker. The JobSeeker payment is a payment for people seeking employment. You can apply for JobSeeker payments if you have been let go from your employer or if you are a sole trader, self-employed, casual or contract worker who has experienced economic downturn due to COVID-19. Unlike JobKeeper, you must meet an income test to qualify for JobSeeker. Details can be found on the Australian Government Services Australia site.
JobKeeper and your worker’s rights
The JobKeeper scheme was introduced to combat the damaging effect of the COVID-19 crisis on businesses and workers. This union won wage subsidy was a good start however some problems with the scheme remain.
The Australian Unions Support Centre can offer you advice on all your JobKeeper questions, such as:
- Can I be instructed to do different work?
- Can I be forced to take annual leave?
- Can my boss cut my pay and make me work my usual hours?
- Can my boss unilaterally cut my hours?
- Can I be directed to work from home?
- Can my boss make me work different hours or days than I normally work?
- If I’ve been stood down, can I do another job or some training?
- Can I be made to work extra hours?
Can I be directed to take long service leave?
Funding for this factsheet was provided by the Victorian Government as part of the uTech project. Please note that the information given here is general information only and is not legal advice. For further assistance, it is recommended you speak to your union.