31st Mar 2020
NEW GOVERNMENT FINANCIAL ASSISTANCE FOR WAGES
As part of the latest round of safety net stimulus packages the Federal Government has announced a new wage payment incentive to assist employers to retain their employees.
The new incentive is known as the Job Keeper Allowance and provides a flat rate payment to the employer of up to $1,500 per fortnight to be paid to their employees who have either been stood down or as a top up payment for employees who are currently working with their employer, whether working from home or at their usual place of work. Examples to explain the top up payment are contained in the Fact Sheets found when you click the Click Here for More Information tab at the bottom of this update.
The payment will apply to employers who keep eligible employees in their employ over the next six months. Therefore, businesses will be required to keep the employee on their books in order to distribute the payment.
The Prime Minister, Scott Morrison said the Job Keeper payment was “to keep Australians in their jobs even when the work dries up”.
The Job Keeper payments will not only apply to full-time workers, but would include part-time workers, sole traders as well as casuals who have been with their employer for 12 months or more, New Zealanders on 444 visas and Not-for-profit entities.
To be eligible, the employer must have had a reduction of business of 30% or more.
Payments will flow from the first week of May but will be backdated to 30th March 2020. Employees stood down since 1st March 2020, will be eligible.
From 30th March 2020, those who are eligible for the wage subsidy will be able to apply to the Australian Tax Office (ATO) via the ATO’s JobKeeper page (www.ato.gov.au/general/gen/JobKeeper-payment/) which means that employers and employees will not have to deal with Centrelink to access the funds.
Note that the compulsory employer superannuation payment (9.5%) does not apply to Job Keeper payments.
Small, Medium and Not for Profit Stimulus
The Allowance is separate to the Small and medium businesses and not-for-profits benefit earlier announced by the Government, which provides a full rebate on income tax withholdings, from $20,000 to $100,000.