On Friday 24 April 2020, the Federal Treasurer provided an update clarifying rules and eligibility criteria for the $130 billion JobKeeper scheme.
One In, All in rules clarified
Over the past week, there have been a number of lingering questions around whether employers had to nominate all eligible employees in their business under the scheme in order to participate. This was clarified with the media statement of the Treasurer confirming that employers wanting to participate cannot actively select which employees participate in the scheme and that they must include all employees meeting the eligibility criteria.
‘One in, all in’ principle: “Once an employer decides to participate in the JobKeeper scheme and their eligible employees have agreed to be nominated by the employer, the employer must ensure that all of these eligible employees are covered by their participation in the scheme. This includes all eligible employees who are undertaking work for the employer or have been stood down. The employer cannot select which eligible employees will participate in the scheme. As noted in the explanatory statement to the existing rules, this ‘one in, all in’ principle is already a key feature of the scheme and will be made clearer in the rules.” (Josh Frydenberg MP, Treasurer of the Commonwealth of Australia).
Exclusion of dependent 16 and 17 year-old students
Another contentious aspect of the scheme was the inclusion of 16 and 17-year-old workers as eligible employees, many of whom would only work a small number of hours per week and who would ordinarily be remunerated far less than the $1500 per fortnight available under the JobKeeper scheme.
The updated rules now state that full-time students who are 17-years-old and younger, who are not financially independent (e.g. live at home with their parents), will not be eligible to receive the JobKeeper payment. The Treasurer has noted that this rule will apply prospectively, so that employers who have already met the wage conditions for these employees for the any JobKeeper fortnights from March 30, 2020 may be eligible to JobKeeper payments in arrears for those fortnights.
Full time students aged 16 and 17 years old: “As noted in the explanatory statement to the existing rules, the benefit of the JobKeeper payment to workers over the age of 16 is justified for those who are financially independent and who require the security provided by participation in the JobKeeper scheme and the maintenance of the working relationship that it affords. The rules will provide that full time students who are 17 years old and younger, and who are not financially independent, are not eligible for the JobKeeper Payment. This clarification will apply prospectively, which would mean an eligible employer that has already met the wage condition of paying such an employee $1,500 for a fortnight could be entitled to a JobKeeper Payment in arrears for that fortnight.” (Josh Frydenberg MP, Treasurer of the Commonwealth of Australia).
There were five additional rules outlined in this JobKeeper update provided by the Treasury relating to special purpose entities, charities, religious practitioners, aid organisations and universities – and the update in full can be found here.
For businesses that need assistance making the first JobKeeper payments to employees before the payments are made to employers, The Treasurer further noted that banks will be establishing special hotlines to assist businesses at this time, with banks prioritising assistance for those with Job-Keeper related applications.
For a detailed review of the JobKeeper initiative and the changes to the Fair Work Act for eligible employers, please visit our updated interactive summary of the JobKeeper Initiative here.
For access to ER Strategies’ COVID-19 toolkit, including updated information for employers directly and indirectly impacted by COVID-19, free downloads and links to helpful government resources, please click here.
ER Strategies will continue to assist our clients to navigate these changes to their employee relations arrangements over the coming weeks and months. Clients of ER Strategies can contact the team during business hours on 1300 55 66 37 for assistance. Non-clients can call us, or contact us here, to discuss how we can best help your business as we move through these unprecedented times.