JobKeeper Update – Treasury Announcement

Important Change to Current JobKeeper Rules

The Government has today announced an important update to the JobKeeper rules. Effective from 3 August 2020, the relevant date of employment will move from 1 March 2020 to 1 July 2020. This will mean that employees will be eligible for the JobKeeper payments if they were either:
– 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.

This will therefore bring in any employees that have started employment between 1 March 2020 and 1 July 2020, and also casual employees that have reached 12 months of employment between these dates.

As this applies from 3 August 2020, employers will need to provide these employees with nomination notices and assess any top-up payments that need to be made for these employees. However, it is noted that this is currently only an announcement and will need to be inserted into the JobKeeper Rules.

Changes to Proposed JobKeeper Extension

In addition to this change, the following changes have been announced to the proposed requirements for the JobKeeper Extension from 28 September 2020:

1. The requirement to satisfy the decline in turnover test for the June 2020 quarter has been removed. Therefore:
– For the period from 28 September 2020 to 3 January 2021, the decline in turnover test will need to be satisfied for the September 2020 quarter.
– For the extension period from 4 January 2021 to 28 March 2021, the decline in turnover test will need to be satisfied for the December 2020 quarter.

2. The reference period for employee hours, to determine which payment rate is applicable, will be as follows:
– For employees eligible at 1 March 2020, it will be based on hours worked in February 2020 or June 2020 (whichever has the higher number of hours worked),
– For employees eligible at 1 July 2020, it will be based on hours worked in June 2020.

The removal of the decline in turnover test for the June 2020 quarter is a welcome change, as this was a specific concern with the prior announcement, particularly for Victorian businesses. However, the Treasurer has ruled out any changes to allow the payment rate for Victorian businesses to remain at $1,500 at this stage and reiterated that the scheme is intended to be a National program.

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For further information, or for general assistance, please contact Our Directors, Jacci Mandersloot or Natalie Claughton.

The information contained in this bulletin is intended to  provide  general information only and is not intended to serve as tax advice. Specific advice should always be sought regarding a taxpayers’ particular circumstances. Please contact MC Tax Advisors if you would like assistance with the issues identified in this bulletin.