Now that the legislation and JobKeeper Rules are in place, we have more clarity on some issues and a few more matters that employers should be aware of when considering whether JobKeeper is right for their business.
Key dates for JobKeeper subsidies
- 20 April: enrolments for JobKeeper payment were opened
- 30 April: deadline for enrolling and paying your employees to claim April JobKeeper payments
- 4 May: from this date, you should identify your eligible employees. You have until the end of May to enrol and identify your employees.
- Monthly: reconfirm your employees’ eligibility and update if changes are made
We explored, in our previous article, some of the criteria and suitability that a business must consider before taking up the JobKeeper subsidy but if employers wish to take advantage of the first fortnight of JobKeeper subsidies, they will need to apply on or before 30 April 2020 for the period commencing 30 March 2020. Therefore it is important to get urgent taxation law and financial advice on your business’ eligibility. Businesses should also keep in mind that the payments will be made in arrears, with the first payments for eligible employers commencing the first week of May 2020.
If you’re not in a position to make the decision or aren’t currently eligible, businesses may still take advantage of the JobKeeper subsidies at a later date (noting that payments are only available until the fortnight ending 27 September 2020 at this stage).
What are the employment law considerations for employers?
First steps for employers is they’ll need to consider which (if any) employees are “eligible employees.”
Factors to consider include:
- whether an employee was employed by you as at 1 March 2020;
- their employment status (full-time, part-time, long-term casual or other);
- age (over 16 years old);
- residency status; and
- eligibility at another workplace, and their agreement to be nominated by you.
If you do not have any eligible employees, you will not be eligible for the JobKeeper scheme even if you satisfy the turnover calculation.
What if ‘stand downs’ or redundancies have already occurred?
Where employees have been stood down on or after 1 March 2020 due to a “work stoppage”, and are eligible employees, businesses may reinstate those employees to their previous roles (or another role) or continue to retain them on stand down. [Our previous article explores in detail employee ‘stand down and its implications for employers].
If, instead of stand down, an employer chose to make employees redundant after 1 March 2020, an employer may now be able to reinstate those employees, but should carefully consider the impact of that reinstatement including previously paid severance payments, possible unfair dismissal applications (where a termination was not a genuine redundancy), whether a varied employment contract is required and whether the employee will be returning to the same or a different role.
Implications of recent changes to the Fair Work Act and Awards
As part of the implementation of the JobKeeper scheme, the Fair Work Act 2009 (Cth) has also been amended to provide greater flexibility to employers who are eligible for the JobKeeper scheme in relation to directions on stand down, variations to hours (and pay) and variations to an employee’s role.
In addition, many Awards were recently updated to allow greater flexibility to employers in relation to:
- annual leave;
- changes to work hours; and
- the provision of “pandemic leave”.
Employers may wish to consider if these options may provide an alternative (or be used in conjunction with) the JobKeeper subsidies.
Whether they are taking the benefit of the JobKeeper scheme, changes to the Fair Work Act, variations to the Award or options under an enterprise agreement (which can be varied with the consent of employees), employers must ensure that they continue to comply with their employment law obligations, including:
- Payment of minimum wage and other entitlements;
- Notification and consultation requirements under various Awards and industrial instruments;
- Workplace health and safety obligations;
- Record-keeping obligations under the Fair Work Act; and
- Reporting obligations to the ATO and other regulators.
So where does that leave the employer and employee obligations?
Employers and employees continue to remain bound by any employment contract that exists unless that contract is varied (with the consent of both parties) or the contract provides for a particular type of variation, such as a reduction in hours or change to role. We recommend that any variations are recorded in writing and signed.
Where changes to employment are made due to a business taking advantage of the JobKeeper scheme, employers should ensure that any changes to hours, rates, and roles are recorded in writing and there is clear agreement as to how long those changes will continue.
I operate as a sole trader, partnership or trust structure – am I eligible for JobKeepers?
Sole traders and partnerships, as well as some trusts, may be eligible for JobKeeper subsidies, but should keep in mind that (unless they are a national system employer) many of the obligations and benefits under the Fair Work Act may not apply to them; rather they will need to look to State legislation, such as the Industrial Relations Act 1979 (WA) and Minimum Conditions of Employment Act 1993 (WA). Further information is available on the ATO website.
For further information on the taxation aspect of Job Keepers, please see a copy of the Tax Institutes most recent newsletter HERE.
HHG Legal Group can assist
It is important for businesses to get early and specific legal and financial advice on these matters before enrolling in the scheme to avoid running into financial or legal issues at a later stage. HHG Legal Group and our taxation and accounting partners can provide speedy advice on these issues and more
For over 100 years HHG Legal Group has been proudly serving Western Australian families, business and individuals. Never before has the State seen such a crippling time for many small businesses and we are committed to supporting the communities in which we operate. If you require advice relating to your obligations as a small business employer in the time of COVID-19, or have any other employment law queries, we are offering unprecedented initial consultation fees to assist in these challenging times.