Extension of the JobKeeper provisions under the Fair Work Act

The information and links contained in this article are correct at the time of writing (18 September 2020) and does not constitute legal or financial advice.

The Federal Government has extended the JobKeeper scheme and the provisions which were inserted into the Fair Work Act to provide short-term flexibility by enabling JobKeeper eligible employers to issue various directions to eligible employees.

The extended provisions take effect from 28 September 2020 and apply until 28 March 2021, which is the same date that the JobKeeper scheme will end.

Guidance on the JobKeeper provisions is regularly reviewed and updated, so for up-to-date advice please contact the Ai Group Workplace Advice Line.

What sorts of directions can employers give to employees under the original JobKeeper provisions in the Fair Work Act?

When JobKeeper was originally introduced, the Fair Work Act (FW Act) was temporarily amended to support the practical operation of the Australian Government’s JobKeeper scheme in the workplace.

Ai Group was involved in the development of the legislation and we worked hard to achieve a successful outcome.

The amendments to the FW Act provide employers who are eligible to access the JobKeeper scheme the ability to:

• issue directions to employees about their work duties, work location and the number of hours of work; and
• request employees agree to changes to days and times of work and taking annual leave. Employees are required to consider and must not unreasonably refuse an employer’s request.

Various safeguards and rules apply when issuing directions or requesting employees’ agreement, including in relation to accrual of service entitlements such as annual leave and how termination of employment payments are calculated.

What is changing for employers?

When ‘JobKeeper 2.0’ commences on 28 September, there will be two different categories of employers due to changes in eligibility criteria, and the directions that may be given to employees will vary depending on which category an employer is in.

As outlined in our previous article ‘What’s different about JobKeeper 2.0?’, https://www.employmentplus.com... changes to the business eligibility criteria means that some employers that were previously eligible under the original JobKeeper scheme may not be eligible for JobKeeper 2.0.

However, if these employers can demonstrate a 10% reduction in turnover, they can still issue some JobKeeper enabling directions under the FW Act as part of the extended scheme. These employers are referred to as ‘legacy employers.’

Employers who are eligible for the JobKeeper 2.0 scheme are referred to as ‘qualifying employers’.

The two categories and the directions that may be issued to employees are discussed in more detail below.

A key difference for both categories of employers is that the current entitlement under the original JobKeeper provisions allowing employers to request employees to take annual leave, including at half pay has been repealed and will be discontinued from 28 September 2020. From this date, any previous agreement to take annual leave under these provisions stops applying, and employers and employees will need to follow the usual rules, including those in an award or company policies and procedures, for taking annual leave.

Category 1: Employers who are eligible for the JobKeeper 2.0 scheme (also known as ‘qualifying employers’)

Qualifying employers who are eligible for the JobKeeper 2.0 will have access to the full range (other than the annual leave provisions discussed above) of directions and agreements with eligible employees:

• JobKeeper enabling stand down directions – for example, a direction to work less or no hours;
• Directions relating to the location of work;
• Directions relating to work duties; and
• Agreements about the days and times that an employee will work, with an employee unable to unreasonably refuse agreement.

Any JobKeeper enabling direction or agreement will stop applying on 29 March 2021 or when they are withdrawn, cancelled or replaced (whichever comes first).

An employer that issues a direction under one of the above provisions must consult with employees and provide employees with three days’ written notice.

Category 2: Employers that were eligible for the original JobKeeper scheme but are not eligible for the JobKeeper 2.0 scheme, and who have experienced a decline in turnover of 10% or more (also known as ‘legacy employers’)

Legacy employers will not qualify for JobKeeper payments from the Australian Tax Office (ATO) after 28 September 2020 however under the extended provisions, they will have continued access to the following modified forms of directions and agreements with eligible employees, but only if they have experienced a decline in turnover of 10% or more:

• JobKeeper enabling stand down directions – but hours of work cannot be reduced to less than 60% of the hours that the employee was working on 1 March 2020, and cannot be less than 2 hours per day;
• Directions relating to the location of work;
• Directions relating to work duties; and
• Agreements about the days and times that an employee will work, with an employee unable to unreasonably refuse agreement. The agreement must not result in the employee working less than 2 hours per day.

Expanded consultation requirements and a longer notice period of 7 days apply to legacy employers before giving a JobKeeper enabling direction, and a direction can only be issued to employees for whom the employer previously received a JobKeeper payment.

Legacy employers will be required to meet the 10% decline in turnover test and obtain a ‘10% decline in turnover’ certificate from an eligible financial services provider for each relevant quarter. An eligible financial service provider is defined as a registered tax agent, BAS agent or a qualified accountant.

Small businesses with less than 15 employees will be able to self-certify by making a statutory declaration but can choose to have a written certificate from an eligible financial service if they prefer. Information on how to complete a statutory declaration is included in the links below.

Penalties will apply for employers that do not meet the 10% decline in turnover test and who knowingly or recklessly try to use the provisions.

There are rules dealing with when directions will cease if an employer does not meet the 10% decline in turnover test and obtain a ‘10% decline in turnover’ certificate.

The JobKeeper rules may be amended from time to time. To ensure that you have the most current information, please call the Ai Group Workplace Advice Line.

Where can I find more information?

Treasury’s Fact Sheets are being regularly updated and can be accessed via this link: https://treasury.gov.au/coronavirus/jobkeeper/extension

The Australian Tax Office: https://www.ato.gov.au/general/JobKeeper-Payment/& https://www.ato.gov.au/General/JobKeeper-Payment/JobKeeper-extension-announcement/

Fair Work Ombudsman: https://coronavirus.fairwork.gov.au/coronavirus-and-australian-workplace-laws/pay-and-leave-during-coronavirus/jobkeeper-wage-subsidy-scheme

The Attorney-General website has some guidance and a template to complete statutory declarations: https://www.ag.gov.au/legal-system/statutory-declarations/complete-statutory-declaration

Further advice or assistance

For further advice or assistance on this topic or any other workplace relations matter, contact the Ai Group Workplace Advice Line.

Call 1300 862 217 8.30am – 5.15pm AEST Mon-Fri

Email Eplusworkplace@aigroup.com.au