Employer advice as JobKeeper passes parliament


Unless you have been living under a rock you will be aware that JobKeeper legislation was passed last week.

So what does this mean?

Who is eligible?

Unless you run a government agency, as long as you can show a 30 per cent decrease in revenue (50 per cent for those billion-dollar operations) or 15 per cent decrease for charities then there is a good chance you will be eligible. So yes - sole traders, small businesses, not for profits are all eligible to apply.

How do I show the revenue decrease?

This is when declaring your businesses earnings for tax purposes will help you.

Ideally, the ATO (Australian Taxation Office) will look at what you declared as revenue each month or quarter last year to this year, however, if this is not a good representation of what your company was expected to turn over this year then the ATO will give consideration to your argument.

For example, if your business has scaled up since last year, you were not trading this time last year, or your industry does not have a regular pattern of revenue, then you should sharpen your persuasive argument skills and may the force be with you as you mount your case to the ATO.

If my business is not eligible now but business drops off can I apply down the track?

Merry Christmas, yes you can.

Can I choose which staff I will put on JobKeeper?

No, there is a “one in, all in” clause. So if you apply for JobKeeper then you must pay it to all eligible employees, that is casuals employed with you since 1 March 2019, full and part-time staff employed since 1 March 2020 (only available for those 16 years and older and for those working multiple jobs they can only receive JobKeeper with one employer).

You must advise employees in writing that you are receiving JobKeeper, rumour has it there will be a specific form that you will need to complete and give to each employee – however, this is yet to be widely released.

Do I have to pass on the full $1500 a fortnight?

Yes, this is sweet for those casual or part-time staff who usually earn less than $1500 a fortnight.

If I have staff working their normal hours can I reduce their pay to $1500 a fortnight?

For those employers who have asked me this question I feel like banging my head against a brick wall - it is a very loud no, that is not allowed.

However, completely separate to JobKeeper if you are able to negotiate a wage cut through this period with your staff, as long as it is mutually agreed and they are still receiving the relevant Award pay requirements then happy days. 

Will the government give me the money upfront?

No, it will be paid monthly in arrears, however, if this is an issue go and speak to your friendly bank, we understand that they have given their commitment to play the generous uncle over this time and will be making loan facilities for businesses on JobKeeper available.

Do I have to pay superannuation and tax?

Yes the $1500 will get taxed as normal, superannuation is payable on hours that are worked, however, if you are passing on the $1500 to a staff member on stand down (i.e. not working) then no superannuation is payable.

Do I accrue leave for staff on JobKeeper?

Yes, you do, continue to accrue annual leave and personal leave as you would have previously.

What are JobKeeper Directives?

So this is where things get interesting and there were a few surprises in store for Industrial Relations geeks like us. JobKeeper has some magical directive powers for employers:

  1. You can direct employees to work reduced hours (i.e. a full-timer on JobKeeper may be directed to only work 20 hours a week due to a decline in business)
  2. You can direct employees to undertake different duties (as long as they can do it safely and it is within a reasonable scope of their skillset, so no rewiring of your house unless you employ electricians but cleaning, archiving, reviewing policies - go for it)
  3. You can direct an employee to work at a different location than their normal workplace (i.e. work from home)

In justifying the Directives you need to apply the “but for” test:

But for you doing this (directing different duties or a different work location) the employee would be made redundant.

What are JobKeeper flexibilities?

Another buzz phrase for us, JobKeeper flexibilities are what we can request of staff on JobKeeper:

  1. Work on different days and at different times (i.e. if they are a chef you may ask them to clean the freezers during weekdays rather than doing it on weekend nights)
  2. You can request that an employee takes their annual leave and the employee should not reasonably refuse the request. So this is a win for employers who can essentially use JobKeeper to pay down the leave accruals. The employee has the right to withhold two weeks leave balance but for those with a high leave accrual, it is a great way to get this liability down.

We all have to remember that this legislation was passed at lightning speed and it will not be perfect, so no doubt as it gets scrutinized, challenged and pulled apart there will be changes to how it is interpreted.

Based on the information that we currently have this was our understanding and interpretation, however, as a disclaimer this is general advice and we reserve the right to backflip should we receive further clarification.

If you are looking for specific advice for your business then we recommend that you seek expert advice.


Phoebe Kitto a Director at HR Dynamics.

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