We have previously reported on the changes to the Jobkeeper wage subsidy, and in particular the movement from the current one rate for eligible employers, to a new two-tiered system. The Government has now provided additional clarification on how this will operate in practice.
Importantly, the wage subsidy can now be claimed for employees who were engaged as a permanent employee, either full-time or part-time between 1 March 2020 and 1 July 2020. The impact for casual employees is that the scheme has been extended to include causal employees who, as at 1 July 2020, had been employed for at least 12 months. Therefore, any regular and systematic casual employees who reached the milestone of 12 months service between 1 March 2020 and 1 July 2020 will now qualify.
From 1 October 2020, the new two-tiered wage subsidy is being introduced. Full-time employees will fall within the higher of the two tiers, being $1200 per fortnight from 1 October 2020 and $1000 per fortnight from 1 January 2021. For part-time employees and casual employees, the employer will need to determine which tier is appropriate. To make this determination, an employer should for each part-time and casual employee, calculate the hours that they were working in February 2020 and June 2020. If, in either of these two months, the employee was working an average of more than 20 hours per week, they will fall into the higher tier. However, if the employee was working less than 20 hours per week in both months (or just June 2020 if they are a new part-time or casual employee) then they would fall into the lower tier. The wage subsidy for the lower tier is $750 per fortnight from 1 October 2020 and $600 per fortnight from 1 January 2021.
Importantly, all employers will need to review the hours that all employees will be working from 1 October 2020 to ensure that they are properly remunerated. Where employees are only able to be offered the number of hours which can be covered by the Jobkeeper wage subsidy, the hours of work will need to be reduced commensurate with the lower wage subsidy amounts.
Now is the time to review your records to ensure you comply with the new subsidy payment requirements. If you require assistance, please contact our HR Consulting team at MazarsHR@mazars.com.au or call +61 7 3218 3900.
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