JobKeeper payments have provided significant support for many employers throughout the COVID-19 pandemic. Employers should now take note that the second phase of the JobKeeper extension has begun, effective 4 January 2021, reducing payments for employees further.
JobKeeper Extension 2 runs from 4 January 2021, to 28 March 2021. At this time, there are no government plans announced to extend these payments further, with businesses required to pass the original decline in turnover test (talk to your accountant about whether your business is eligible).
For your payroll obligations, eligible employees will now receive at least:
Tier 1 – $1000 per fortnight (before tax)
Tier 2 – $650 per fortnight (before tax)
A Tier 1 employee are employees who:
- are eligible employees who worked for 80 hours or more in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and
- are eligible business participants who were actively engaged in the business for 80 hours or more in February and provide a declaration to that effect.
Whilst a Tier 2 employee is:
- any other eligible employee and eligible business participants.
You can also choose to stop receiving JobKeeper payments at any time.
The federal government has flagged the JobKeeper program as ending at the end of this extension, however, many employers will still be able to take advantage of the JobMaker Hiring Credit scheme, which was ratified late last year, and will start commencing payments in February 2021.
JobMaker, whilst more restricted in terms of employee eligibility, with payments only made for newly employed, eligible employees up to the age of 35, will still be a valued incentive for hiring new staff.
It’s important to note that if your business is claiming any of the following incentives for a particular employee, they won’t be eligible for the JobMaker Hiring Credit:
- Supporting Apprentices and Trainees Wage subsidy
- Australian Apprentice Wage subsidy
- Boosting the Apprenticeship Commencements Wage subsidy
- Restart, Youth Bonus, Youth, Parents or Long-term Unemployed Wage Subsidies.
If you’ve got questions about how JobKeeper payments work in your payroll system, be sure to give our Workplace Partners a call ASAP.
For further information on the specifics of the changes to JobKeeper, the ATO has a wealth of easy-to-read resources.
*This is general information only and doesn’t take your specific circumstances into account.