The JobKeeper scheme was a wage subsidy for businesses significantly affected by coronavirus.
During its operation, it also gave some employers extra flexibility to help manage their business.
These employers could use temporary provisions under the Fair Work Act (JobKeeper provisions) to give employees certain directions (called JobKeeper enabling directions) or make certain agreements with them.
Employers significantly affected by coronavirus could access the JobKeeper scheme to help them keep paying their employees. The JobKeeper scheme started on 30 March 2020. It was originally due to end on 27 September 2020 but was extended until 28 March 2021, with some changes.
Eligible employers could claim a JobKeeper payment, which was a reimbursement to help them continue to pay their employees. The JobKeeper scheme and JobKeeper payments were administered by the Australian Taxation Office (ATO).
Qualifying employers could claim a reimbursement (before tax) per fortnight for each eligible employee who:
- was employed by their employer on 1 March or 1 July 2020
- was employed for the fortnights for which that the employer claimed the reimbursement (including those who were stood down or re-hired).
To be eligible before 3 August 2020, employees had to be employed by their employer on 1 March 2020. To be eligible from 3 August 2020, employees needed to be employed by their employer on either 1 March or 1 July 2020.
For the JobKeeper fortnights from 28 September 2020, there were 2 payment rates:
- a Tier 1 (higher) rate
- a Tier 2 (lower) rate.
The payment rate also had 2 stages, with the rate reducing after a certain date. The rates in the table below are before tax.
|Tier 1 rate
|Tier 2 rate
|28 September 2020 – 3 January 2021
|4 January 2021 – 28 March 2021
Whether an employee was entitled to the Tier 1 or Tier 2 rate was based on whether they met the 80-hour threshold, as set out in the ATO's criteria.
JobKeeper provisions under the Fair Work Act
To support the operation of the JobKeeper scheme, temporary JobKeeper provisions were added to the Fair Work Act to give certain employers increased flexibility to manage their workplaces during the impact of coronavirus. These provisions started on 9 April 2020 and applied until 29 March 2021, with some changes from 28 September 2020.
Employers may have been able to access the JobKeeper provisions if they were a:
- qualifying employer: employers who qualified for the JobKeeper scheme and were receiving JobKeeper payments for their employees
- legacy employer: employers who previously qualified for the JobKeeper scheme but no longer qualified, or chose not to participate, from 28 September 2020.
Employers who qualified for the JobKeeper scheme could give their eligible employees JobKeeper enabling directions. This meant they may have been able to temporarily:
- stand down an employee (including by reducing their hours or days of work)
- change an employee’s usual duties
- change an employee’s location of work.
The JobKeeper provisions also allowed these employers to make agreements with their eligible employees to change their days and times of work.
JobKeeper enabling directions or agreements that were already in place on 27 September 2020 kept applying after this date as long as the employer continued to qualify for the JobKeeper scheme and the requirements to give a direction or make an agreement continued to be met.
JobKeeper enabling directions or agreements stopped applying when:
- they were cancelled, withdrawn or replaced (including by a Fair Work Commission order), or
- on 29 March 2021 (whichever came first).
From 28 September 2020 until the end of the scheme, certain employers could continue using some of the extended JobKeeper provisions if they:
- previously participated in the JobKeeper scheme, but no longer participated from 28 September 2020
- demonstrated at least a 10% decline in turnover for a relevant quarter by getting either a:
- 10% decline in turnover certificate from an eligible financial service provider, or
- if they were a small business, getting a statutory declaration.
These employers were called legacy employers. Legacy employers could:
- issue JobKeeper enabling stand down directions (with some changes)
- issue JobKeeper enabling directions in relation to employees’ duties and locations of work
- make agreements with employees to work on different days or at different times (with some changes).
Participating in the JobKeeper scheme
If an employer chose to participate in the JobKeeper scheme, they needed to give all their eligible employees a notice telling them that they intended to participate and ask them if they agreed to be nominated and receive payments as part of the scheme. Employers had to do this within 7 days of enrolling.
The ATO said that an employer who decided to participate in the JobKeeper scheme should have nominated all their eligible employees who agreed to be nominated (also known as ‘one in all in’).
An employer could have chosen not to participate in the JobKeeper scheme. If an employer chose not to participate in the JobKeeper scheme at all, they couldn’t:
- receive JobKeeper payments from the ATO on behalf of their eligible employees
- use the JobKeeper provisions for their employees.
All the usual rights and obligations under the Fair Work Act and the applicable award or agreement still applied during this time.
Employers that no longer qualified for the JobKeeper scheme from 28 September 2020, but met the requirements to be a legacy employer, may have continued to use some of the JobKeeper provisions (with some changes).