Government stimulus package

Late Friday evening, the Treasurer tabled the Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No. 2) 2020 (the Amendments), which amends the rules of the Federal Government’s JobKeeper program.

The Amendments give effect to changes announced by the Treasurer on Friday 24 April 2020, including important clarifications to the “one in, all in” aspect of the JobKeeper scheme and the eligibility of junior employees.

Multiple other amendments have been made, however due to the interest in these particular topics as expressed over our Workplace Relations Hotline, we take this opportunity to explore these in more depth.

One in, all in

Effective immediately, employers must notify their employees, in writing, that they have elected to participate in the JobKeeper program within 7 days of enrolling with the ATO. Failure to give this notice is an offence under taxation legislation which can be punished by fines, and even imprisonment of up to 12 months.

This notice must inform the employees of the steps they can take to provide a nomination notice to the employer. Please note that as at 10:00am on 2 May 2020, the Employee Nomination Notice Form published on the ATO website has not yet been updated to reflect the changes in the rules.

Once an employer has received a nomination notice from their employee, the employee is eligible to receive JobKeeper payments from their employer.

If an employee satisfies the other eligibility criteria, and has provided the employer with their nomination notice, the employer must satisfy the wage condition – that is, the payment of $1,500 per JobKeeper fortnight to the employee.

Failure to satisfy the wage condition is a civil penalty provision under the Fair Work Act 2009 (Cth) attracting fines of up to $63,000 for a corporation and $12,600 for an individual, or in serious cases $630,000 for a corporation and $126,000 for an individual.

Changes to eligibility of junior employees

Effective from 11 May 2020, employees aged 16 and 17 are only eligible to receive JobKeeper payments if they are:

  1. independent; or
  2. not undertaking full-time study.

The meaning of the expressions independent and undertaking full-time study are taken from the Social Security Act 1991 (Cth).

As the question of whether a person is independent or undertaking full-time study for the purposes of the Social Security Act 1991 (Cth) is quite complicated, and in some cases depends on the discretion of the Secretary of the Department of Social Services, the employer is not required to make this assessment.

Instead, the employee nomination notice must now include either:

  1. a statement that the employee is independent within the meaning of section 1067A of the Social Security Act 1991 (Cth); or
  2. a statement that they are not undertaking full-time study within the meaning of the Social Security Act 1991 (Cth).

There is, however, a gap in this approach, as the employee is only required to declare that they are either independent or that they are not undertaking full-time study; they are not required to confirm both.

Therefore, an employee may validly include a statement that they are not undertaking full-time study, and remain silent on the fact that they are not independent, and they will have discharged their obligations under the law.

In broad terms, a child may be independent if:

  • have supported themselves through work with long term full or part-time employment broadly for a two year period;
  • are, or have been, married or are in a registered relationship;
  • have lived in a de facto relationship as a member of a couple for at least 12 months;
  • have, or have had, a dependent child;
  • are a job seeker assessed as unable to work over 30 hours a week;
  • are unable to live at home due to extreme circumstances;
  • have parents that are unable to support them;
  • are a refugee and their parents do not live in Australia;
  • are an orphan that has not been legally adopted; or
  • are in state care, including foster care.

In broad terms, a person is engaged in full-time study if they are enrolled in and undertaking study in a course of study at an educational institution of at least 75 per cent of the normal full-time study requirements. Where a school leaver is enrolled to commence university or other further education, they continue to be considered to be a full‑time student despite classes having not necessarily commenced as at 1 March 2020.

You can read about these updates in our JobKeeper Q&A Guide. In the meantime, please call 1800 RETAIL and press 1 to speak with one of the Workplace Relations team who can assist with any queries you have about changes to the JobKeeper rules.