The JobKeeper scheme was originally scheduled to cease on 27 September 2020. While it has come at considerable cost to the Commonwealth Government (although approximately half of the $130 billion initially forecast), the scheme has provided critical support to 960,000 businesses and 3.5 million workers – approximately 30% of the pre-COVID-19 private sector workforce.
A recent Treasury review found the scheme has met its objectives and there is a strong case for it continuing, given employment is expected to decline by 5% between the March and September quarters. However, the review noted if the scheme is to continue, it will need to be the subject of some amendments.
Legislation has just passed (on 1 September 2020) to continue the JobKeeper scheme until 28 March 2021, [3] albeit with some reduced benefits for both employers and employees. The extended JobKeeper scheme will occur over two extension periods and is expected to cost the government an additional $16.6 billion. The JobKeeper scheme is administered by the Australian Taxation Commissioner and implemented through the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (Cth), which have also been amended and extended.
A summary of the key differences between the schemes is set out below, and explored in greater detail in this article.
Original JobKeeper | 30 March 2020 to 27 September 2020
- Employers are required to meet a projected downturn in revenue threshold in order to be an “eligible employer”
- “Eligible employers” are able to access a $1,500 per fortnight wage subsidy for each “eligible employee”
- JobKeeper enabling directions do not apply if the direction is unreasonable in all the circumstances
- Ability to request employees reach agreement to take annual leave (such agreement cannot be unreasonably withheld)
JobKeeper 2.0, Phase 1 | 28 September 2020 to 3 January 2021
- Employers will be required to establish that their actual downturn satisfies the requisite threshold in order to be an “eligible employer”
- “Eligible employers” are able to access a $1,200 or $750 per fortnight wage subsidy for each “eligible employee” depending on whether the employee’s average hours of work exceed 20 hours per week
- JobKeeper enabling directions do not apply if the direction is unreasonable in all the circumstances
- A direction regarding the reduction of hours given to employees in a particular category may be unreasonable if the directions have an unfair effect on some employees in that category compared with other employees in that category who are also subject to those directions
- No ability to request employees reach agreement to take annual leave
JobKeeper 2.0, Phase 2 | 4 January 2021 to 28 March 2021
- Employers will be required to establish that their actual downturn satisfies the requisite threshold in order to be an “eligible employer”
- “Eligible employers” are able to access a $1,000 or $650 per fortnight wage subsidy for each “eligible employee” depending on whether the employee’s average hours of work exceed 20 hours per week
- JobKeeper enabling directions do not apply if the direction is unreasonable in all the circumstances
- A direction regarding the reduction of hours given to employees in a particular category may be unreasonable if the directions have an unfair effect on some employees in that category compared with other employees in that category who are also subject to those directions
- No ability to request employees reach agreement to take annual leave
