Who is eligible for the government's new JobKeeper payments
With 110,000 businesses signing up to the $130 billion wage subsidy lifeline within 16 hours of it being released, what does it mean for employees?
Even if you have been stood down or retrenched since March 1, you are eligible for $1500 a fortnight JobKeeper payment. If your employer has been shut down under government orders, they can receive money to pay their employees.
It covers full-time, part-time workers, sole traders and not-for-profits but casuals who haven't worked for the same boss for the last 12 months aren't eligible.
The $1500 payment is for employers whose turnover has fallen by 30%. They need to show the Australian Tax Office they have suffered a downturn. Companies with $1 billion turnover qualify for subsidy if turnover falls 50%.
The $1500 payment, before tax, is around 70% of the median wage but a full replacement wage for workers in hospitality, tourism and retail sectors. Employers have to pass on the full amount of the subsidy, $1500 a fortnight, to their employees.
If employees are paid less than $1500, they will get a pay rise. If they are paid more, then the employer could top up their wage. For example if you earn $2000 a fortnight, your employer will receive $1500 and it can add a further $500 to reach your usual salary.
The JobKeeper subsidy is expected to save six million jobs. Eligible employees include Australian residents, New Zealand citizens in Australia who hold a subclass 444 special category visa, and migrants who are eligible for JobSeeker payment or Youth Allowance.
Anyone laid off since March 1 is eligible for the subsidy. This means if you have been retrenched, your employer can put you back on the books so you can be eligible for the payment. But you won't be eligible for the JobSeeker welfare payment which pays up to a maximum of $1100 a fortnight, administered through Centrelink.
Eligible businesses can apply for the payment online, registering via ato.gov.au
Even if the employer goes into hibernation mode over the next six months, they can pay their employees the JobKeeper payment.
"This is about keeping the connection between the employer and the employee and keeping people in their jobs even though the business they work for may go into hibernation and close down for six months," says prime minister Scott Morrison.
"When the economy comes back, these businesses will be able to start again, and their workforce will be ready to go because they will remain attached to the business through our JobKeeper payment."
One of the catches for employers is that the payment isn't available until May 1. One possible strategy is for employers to access a $100,000 cash flow grant to pay their employees in the meantime.
Also the ACTU says that the payment is insufficient and needs to be closer to the median wage of $1375 per week. "The delay to May 1 will pose cash flow issues for many workers who have already been laid off or who's employer may not survive another six weeks without immediate support," says ACTU secretary Sally McManus.
If you have been laid off and your employer does not rehire you, then there is a separate payment for individuals called the JobSeeker payment. It is the former Newstart payment which has been boosted over the next six months with a coronavirus supplement of $550 per fortnight.
Also the government has lifted the amount an unemployed person's partner can earn to qualify for the payment from $48,000 to $79,762.
Rent relief that includes details of a freeze on tenant evictions and assistance for landlords is expected to be announced by the government in coming days.
How JobKeeper works
Phoebe works in administration services of a large retail company as a permanent full-time employee, but she has been stood down under the Fair Work Act without pay.
Phoebe had registered an intent to claim with Services Australia for access to the JobSeeker Payment and the Coronavirus Supplement.
Phoebe is single, with no children and in total she would be eligible to receive $1124.50 before tax per fortnight from Services Australia.
Phoebe's employer has decided to apply for the JobKeeper Payment for all its eligible employees for up to six months. This would entitle Phoebe to $1500 per fortnight before tax. Phoebe's employer is required to advise her that she has been nominated as an eligible employee to receive the payment. If Phoebe elects to receive income support though Services Australia, she will need to report her income from the JobKeeper Payment to Services Australia. Phoebe may no longer be eligible for income support from Services Australia as a result of receiving the JobKeeper Payment.
Source: Treasury Factsheets
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