JobKeeper Payment


The JobKeeper Payment was announced by the Federal Government on Monday 30 March 2020.  Since then there was much speculation as to how this payment was going to work, who would eligible, and when would the payments start.

The JobKeeper Payment is a payment available to eligible businesses to enable, or assist them, to retain employees where they have been adversely impacted by COVID-19.  For eligible businesses with eligible employees, they will receive $1,500 per employee per fortnight as a wage subsidy or to reimburse payments made to employees.

The rules which underpin this payment were finalised and released on Thursday 9 April.

There are some critical dates which we need to work towards – most importantly that at this stage, it appears eligible employers will need to be registered with the ATO by the end of April 2020 and will have to have paid the first two fortnightly payments to eligible employees by this date to be entitled to the JobKeeper payment from its commencement on 30 March 2020.  This means the eligibility requirements, including the decline in turnover test and employee notifications, need to be considered and actioned before the end of the month.

The ATO has announced the registration form will be available on 20 April 2020.

Below we summarise the key aspects of this payment.

Key aspects of the scheme

  • The employer must be an eligible entity to receive the payment (refer below)
  • The employee must be an eligible employee for the employer to receive the payment from the Government (refer below)
  • The payment is also available to a sole trader, a partner, a beneficiary or a director who is actively engaged in the business
  • The payment must have been paid to the employee before being reimbursed – at a minimum $1,500 must have been paid in the fortnight (there are rules to apply where an employer pays monthly)
  • The concept of a “JobKeeper Fortnight” has been introduced and is relevant when considering eligibility and payment of amounts
  • An employee can only receive the JobKeeper payment from one employer
  • The employer must notify the employee that they are eligible and will be registering them for the JobKeeper payment
  • It is a “one in all in” scheme which means employers cannot pick and choose who gets the JobKeeper payment
  • The employee must confirm that they want to receive the JobKeeper payment from the employer
  • The scheme will run from 30 March 2020 until 30 September 2020

There are a number of administrative requirements that employers are going to have to be across to ensure they are compliant with the rules.  We are working to find a way to streamline and simplify this process.

Eligible employer

The eligibility requirements for the employer are as follows:

  • Must have carried on a business in Australia on 1 March 2020 (or been a not-for-profit pursuing its objects principally in Australia)
  • Satisfies a “decline in turnover test” sometime during the time the scheme runs (30 March – 30 September)
  • Must have paid wages that equal or exceed $1,500 in a JobKeeper fortnight to an employee
  • Have notified the Commissioner that they are participating in the scheme
  • Have given to the Commissioner information on the employee’s eligibility
  • Is not an excluded entity (government bodies or entities, a sovereign entity, an entity that pays the Major Bank Levy, company in liquidation or entity with a trustee in bankruptcy appointed)

Decline in turnover test

This test requires that an entity has had a significant decrease in turnover, measured as follows:

  • An entity with aggregated turnover of less than $1 billion – decrease in turnover at least 30%
  • A charity registered with the ACNC – decrease in turnover of at least 15%
  • An entity with aggregated turnover of more than $1 billion – decrease in turnover of at least 50%

Turnover is defined as GST turnover and there are some specific exclusions and rules that apply with regards to GST turnover.

Turnover can be tested monthly or quarterly by comparing current or projected GST turnover with a comparable prior period; for example an entity could compare projected GST turnover for April 2020 with actual GST turnover for April 2019 and determine the percentage fall (in any) of turnover – where it is more than 30% they will satisfy the decline in turnover test.

Once an entity has passed the decline in turnover test, it does not need to retest.  There are ongoing reporting requirements set out in the rules, however these are not designed to retest eligibility.  The Government has indicated that the ongoing reporting of turnover will be used as an economic indicator.

Eligible employee

Another condition is that the employee must also be eligible. An employee will be an eligible employee where they were employed as at 1 March 2020 and:

  • They were employed by the eligible employer at any time during the fortnight
  • They were aged 16 years or over at 1 March 2020
  • They were a part-time or full-time employee or they were a long term casual employee of the of the eligible employer
  • They were an Australian resident or were a holder of a special category visa
  • They have given a notice to the employer in the approved form that:
    • They satisfy the above requirements
    • They agree to be nominated by the employer

When the employee provides this notice they cannot be an excluded employee (on paid parental leave, paid dad or partner pay, or totally incapacitated and being wholly paid under a worker’s compensation scheme), cannot be an employee of another entity (unless they are a long term casual), and has not given any other employer a notice.

There are specific rules where a business has changed hands or has had other changes which impacted employment.

Payments to a sole trader, beneficiary, partner or director

The rules for a business to qualify for the JobKeeper payment for a sole trader beneficiary, partner or director are very similar:

  • There must a drop in turnover of at least 30% (turnover under $1 billion)
  • The entity must have had an ABN on 12 March 2020
  • The payment recipient must be over 16 years of age on 1 March 2020 and they must satisfy the Australian residency requirements.

Other conditions include:

  • The entity cannot be a not-for-profit entity
  • The Commissioner must be notified that the entity has elected to participate in the JobKeeper scheme and must provide the details of the nominated individual
  • There can be no more than one individual nominated per entity
  • The individual must be an eligible business participant which means they must have a particular role in the business:
    • Sole trader – the individual must be the entity
    • Partnership – the individual must be a partner in the partnership
    • Trust – the individual must be an adult beneficiary of the trust; and
    • Company – the individual must be either a director or shareholder in the company

Payment of the $1,500

To receive the JobKeeper payment, the entity must have paid the wages (the minimum amount is $1,500) before the end of the “JobKeeper fortnight”.  For the first month, there are some transitional rules – mainly because the end of the first JobKeeper fortnight was Sunday 12 April which means many entities will not have made a payment, especially where their businesses are closed or operating on significantly reduced hours.  It is our understanding that to be eligible for the scheme from 30 March 2020, the first two fortnightly payments must have been paid by the end of April 2020.


These rules are conceptually quite simple but have a number of compliance requirements to ensure eligibility for the payment is maintained.

For our clients, we will be in touch with you to discuss your businesses eligibility for the JobKeeper payment and what you need to do to start the registration process.