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Employsure founder & MD Ed Mallett talks JobKeeper over Facebook Live.

Need guidance on managing your business through a crisis? Join us every Friday at midday on Facebook live.

Employsure MD Ed Mallett Talks JobKeeper 2.0
Ed: Hi, everyone. Ed here for our usual Friday session. I hope that you're all well. I am here. It's been a busy week covering know, I ended up covering some subjects that have cropped up this week, particularly one of our old favourites, JobKeeper, has reappeared. We'll talk about that as we go through the session. We're also gonna spend a bit of time talking to you about this concept of the end of the office. There seems to be quite a lot of thinking about that in the media. I know that clients are starting to be concerned about what that means for them, any leases they have. It doesn't apply to every business, of course, but particularly office space businesses and people working from home, what they should do about that. I think there are some risks and costs that perhaps people have been missing that I wanna talk to you about.

Then I'm briefly gonna talk about IR reform. There was some rumbling in the week on that. I think it's one of those ones, I think, when you're in receipt of so much information at the moment you can be worried about what's changing and what isn't. And I'll try and make some sense of things that you might have read in newspapers. And then, finally, we'll go on to our very own stick [SP] to get some questions at the end of it, and we'll go through that.

So, JobKeeper. Oh, sorry, one final thing we might talk a bit about, Victoria as well and what's going on there. JobKeeper. So, what you may have seen during the week was on Monday, I think it was, that JobKeeper 2.0 was passed into legislation. You could well have been forgiven for thinking it already had done, just the way these things get announced including. Everything in advertising campaign from the government gave the impression that JobKeeper 2.0 was already here. It wasn't officially until Monday and it was always subject to the twists and turns that go through the legislative process to working out what on earth it was gonna say. And it says quite a lot. It's not easy, and I will go through that in a moment.

I just wanna go through a bit of a kind of history to JobKeeper, though, without being too tortured in it. Just get us up to speed as to where we are because I think there are various steps that you may well have missed with JobKeeper and in any of them even if you're a JobKeeper expert. I think it merits a quick recap just so that we all know that we're up to speed.

I say my usual caveat before launching into that, that I am not your accountant. I'm not even an accountant. I am a workplace relations specialist. So much of JobKeeper sits at that nexus between financial support and employment relations because it relates to your employees, ultimately. So, where relevant or flag that I think the...if you need specialist advice from your accountant, you should go and get it. I'm telling you information that I'm reading rather than necessarily advising on financial aspects of JobKeeper.

So, remember, there was JobKeeper 1.0 as it's now become known, which is the JobKeeper that we are on and you guys may be on for your business. And that was the melee of questions around what does projections of 30% reduction in turnover mean, when did he measure it, how did he work out whether someone's a regular and systematic casual, when did they start work for you, did they qualify, were they eligible, all of that melee of stuff that in truth you'll have worked through most of those questions by now. Because you will either be getting JobKeeper or you won't. There's a risk, of course, that you could have applied for JobKeeper and you didn't because you were scared off by it or you mis-assumed something about the eligibility rules. And I suppose, in that case, you could apply for the final couple of September fortnights in order to get some money for that, but that's gonna be a small number review. The reality is, if you're on JobKeeper or gonna be on JobKeeper 1.0, you probably already are.

They then snuck in to the back of JobKeeper, this thing that I've called JobKeeper 1.5. And I'm banging the drum weekly on here at the moment to say, be really conscious. It maybe that you were entitled to a higher amount of JobKeeper than you are currently receiving. We may be entitled to have more eligible employees on JobKeeper because a few weeks back now, the goal post shifted where it previously had to be regular and systematic casual for 12 months or permanent employee by the 1st of March 2020. The 1st of March 2020 being the key date. And that meant that a lot of people...we had a lot of questions about people having...starting work on the 3rd of March. What happens if they were sort of regular and sort of systematic? How do you translate that? All sorts of issues about that.

A few weeks ago, they moved the goal post, say, actually, for the August fortnights and the September fortnights, you could be employed from...between the 1st of March and the 1st of July. So, if you started as a permanent employee between the 1st of March and the 1st of July, you could be added to JobKeeper. And if you were a regular and systematic casual for 12 months up to the 1st of July, you could be added. And those... That may, for some businesses, be a really significant change. I know it's a huge change for us here. We're the best part of 70 employees employed during that period that we were able to add to JobKeeper to provide subsidy to them. So, it was a big thing for us and it may be for [inaudible 00:05:47]. So, watch out. Have a look. The August fortnights are now closed, but it may be that you got additional people that might be eligible for the September fortnights. As I said, if you need specific advice, you're obviously gonna speak to your accountant about it. But from workplace relations' perspective, have a look at when those employees started work for you.

Then JobKeeper 2.0. That, as I say, was passed into legislation on Monday. It hasn't kicked in yet. It doesn't kick in until the end of September, beginning of October. And really quite bizarrely with it, and maybe I'm probably wrong starting with JobKeeper 2.0 because no one seemed that bloody interested in it, frankly. I was amazed that when it got passed into legislation on Monday, I'm thinking the financial review, it had only merited sort of one column inch on page six, I think it was, which is quite remarkable when it's meant to be costing another $100 billion to go to employers. We're now in a stage in this crisis where that barely mentions a merit in the main financial newspaper. Anyway, it is a big chunk of money. It is a big level of support for certain types of businesses. So, we're gonna talk a bit about what we know, but perhaps more importantly, what we don't know, and then finally, what the banana skins or problems with JobKeeper 2.0 you should be watching out for are.

So, now, with JobKeeper 2.0, the eligibility changes for it. So, it's no longer this projected 30% down in turnover. You now need to have suffered 30% reduction in turnover for the September quarter to initially qualify. So, that's the quarter ending in September. So, you'll need to speak to your accountant about whether you have suffered that particular level of turnover. It's not as it was first suggested it was going to be, a turnover test relating to two quarters. They reduced it just to that September quarter for the initial period of JobKeeper 2.0. And then they'll look again at the December quarter to see if you get it from January to March. So, you need to have a chat to your accountant about that.

There's also a bit of confusion about which employees are eligible. Now, I am doing some research on JobKeeper 2.0. I've read various blogs, particularly with some pretty, you know, well-regarded and top-level law firms who I think have got this wrong. They've confused JobKeeper 1.5 and JobKeeper 2.0, thinking that the 1st of July date is the eligibility test. So, we've got to work through this and work out and we'll get some... You remember the last time, there came out a series of explanatory notes to see about the employee eligibility tests. So, watch this space on that.

What we do know is there's gonna be some tiered payments. Initially, all of it is gonna be less than the $1,500 a fortnight that people are currently on regardless of their hours of work. It's immediately [inaudible 00:08:56] end of September, beginning October that it's gonna go down to $1,200 a fortnight or $750 if you've done...if you're less than 20 hours of work a week. And then, beginning of January, it will go down again to $1,000 and $650. So, there's some sums of money changes as well that you'll need to be aware of. But otherwise, it largely works the same for those businesses that qualify.

One of the big changes, though, is the question of directions, and this is really our field of expertise here. You'll remember that JobKeeper 1.0 gave employers a really high level of rights against their employees where they can stand them down. They could shift their hours and days of work. They could even shift their location of work and their duties, subject to certain requirements on consultation. But they could do it basically unilaterally. They could also send them on annual leave, subject to leaving them with a couple of weeks of leave in the bag. So, it gave these employers, us employers, a really high degree of rights that they've never had before. And there was a lot of debate about whether employers would get to keep those rights even if they fell off the JobKeeper wagon, so to speak. We are an employer that has now fallen off the JobKeeper wagon. We won't get JobKeeper 2.0. And we were for watching for interest to see whether we'd keep those employer rights there.

And what has been said is that you need to have suffered a 10% reduction in your turnover for that September quarter to keep some form of right on the JobKeeper-enabled directions. Those that are still on JobKeeper 2.0 get to keep the majority of the rights. I'll talk a bit about the difference in a moment.

But what you're starting to hear from me...and if you think you're confused now, just try and go online and have a look at what the difference in...whether you're a legacy JobKeeper business or you're a JobKeeper 2.0 business or whether you're a non-JobKeeper business. There is huge amounts of complexity and confusion. Remembering that mantra that I bang on about on here, which is to always try and communicate in a clear, consistent, and concise way. JobKeeper 2.0 just isn't that. It's big, fat, complex, messy. You've got to work out which type of business you are, whether you're a non-qualifier, a legacy qualifier or a JobKeeper 2.0 qualifier. A series of rights and obligations flow from each of those categories of employers. We'll no doubt answer some questions on that.

So, what don't we know at the moment? Gotta get some clarity around eligibility for employees. We don't know the specific dates on which you're gonna have to have paid or satisfied what's known as the wage condition to recoup JobKeeper. Lack of clarity around childcare. You remember in the middle of, I think it was, July, childcare was removed from the JobKeeper scheme because of other subsidies. So, getting those subsidies have now ended. What's gonna happen to childcare in JobKeeper 2.0? A bit of a lack of clarity about enforcement and being legacy business. What's gonna happen if you are, let's say, a business that was down 10% in the September quarter? And that changes over the course of the quarter. Does that mean that you can still stand people down, or do you have to bring them back to work, and all sorts of melee and mess that I think will flow from this.

We don't know the exemptions as to how you will qualify for JobKeeper 2.0 if you're not a normal shaped business. What happens if there was some extraordinary event in this September quarter that means that you're not down by 30% this year, but you are on a quarter on quarter basis or something like that?

So, those are a few of the things we don't know. On the directions, what we know is this. You can, if you're a JobKeeper 2.0 business, still stand people down. If you're a legacy business, you can only stand them down to 60% of their hours. That's a big change. You can change the days and times of your employees' work if you're a JobKeeper 2.0 business. If you're a legacy business, you can, but they can't work less than two hours in succession. You can change the location, whether you're a JobKeeper 2.0 business or a legacy business. And you can change the duties, whether you're a legacy business or a JobKeeper 2.0 business. You can't enforce people to go on annual leave anymore. And generally speaking, for all JobKeeper 2.0 and legacy businesses, these JobKeeper-enabled directions, suddenly, you need a seven-day consultation period rather than the shorter period that was previously in place.

So, there's a lot there, guys. A lot, a lot. We'll answer some questions on it, I'm sure. And I'm sorry that it's so confusing. It is a frustration. Confusion doesn't breed certainty. It doesn't breed confidence in the business community, but there is a lot of information there to digest.

What are the pitfalls? A couple of flags to put in the air if you're even at this stage. So, bear in mind that the way in which it will work out if you're eligible for JobKeeper 2.0 is through your September quarter BAS information. And the requirement to calculate that is gonna be earlier than your BAS due in October. So, you're gonna have to do your calculations through your bookkeeper or accountant earlier than you might otherwise.

You've got the same risk that we previously had of signing off a load of people as long-term casuals and then finding that because you've just admitted you employ long-term casuals, you actually owe the manual leave and sick pay and things like that under the Rossato decision. There are eligibility issues that are gonna crop up, and then there's gonna be all sorts of HR employment relations issues with people know, do you need to...people that are on JobKeeper 1.0 at the moment, do you need to bring them back to work? Now, what happens if you're not sure if you qualify? How is the intersection between or the cross-section between...crossroads between 1.0 and 2.0 going to work? So, it's a lot of mess, guys. We'll try and work our way through that for you now.

So, moving on from JobKeeper 2.0, we will come back to it in questions, but if the newspaper's right, you're not interested in it in any way, so, maybe [inaudible 00:15:47] and I've just been prattling on about the confusion of it for no reason. But I'm gonna talk about something that you might be more interested in. It seems to be ringing some bells for people, those that we're speaking to, which is this concept that the office work has ended or has changed seismically and will never go back to the same way.

Now, not everyone works in an office. Some of you may have office space businesses. Others may have businesses with an office element, and you may well have consequently people working from home at the moment or who have worked from home at various stages during the crisis. Now, there's a lot of talk, I think, about...from an employee perspective with people saying, "I never wanna go back to a stinky office again." From an employer perspective, maybe some dollar signs going off in your eyes about the fact that you can save some money on rent and so forth. Now, I think that there are a couple of things that employers are typically getting wrong from those that I'm speaking to and some of the big employers as well I'm reading about.

First of all, I think that employers are letting the tail wag the dog on this issue. Now, if you think about employment law in its most basic sense, when you're studying employment law, what they tell you is that it's all about the concept of what you call a master versus servant relationship. Very old-fashioned language, highly inappropriate language in the workplace today. If I told the guys sitting here that they were my servants, I suspect they might start throwing things at me. But that's the way employment law works. What it really means at the heart of it is that the employer controls the employee. That's a very fundamental aspect of employment law. Control takes a number of...has a number of aspects, but it includes you, subject to an employee's agreement. But they wouldn't kind of work for you if they didn't agree, having them work in certain places, doing some duties, doing them in certain ways, determining which tools of trade they use for it and so forth.

Now, amongst the other things that have gone mad in the midst of COVID is that a lot of employers seem to have forgotten that. They now seem to be saying to employees, "Do you wanna come back to work?" And employees are great...with great amazement, the employees seem to say, "No, thanks. I don't wanna sit on horrible public transport for two hours a day. I'd much rather work at home in my pyjamas. And my life just got a lot easier."

So, in my view, employers have been asking the wrong question. They haven't been asking a master question. They've been asking it in a way that allows the tail to wag the dog. And they've been asking people what they want to do rather than asking what the business needs.

And, fundamentally, I've talked before about your obligation as a business owner to your shareholders, which might be yourself in small businesses. But you have a fiduciary duty to act in the business' best interest, which hopefully, coincides with your employees' best interest. But it might not. It might be that your employees don't wanna come into work at the moment, but actually, either for productivity reasons or whatever reasons you want them to. And you're entitled as an employer to request them to come back, subject to the social distancing that's going on in different states and so on, and subject to it being a COVID-safe workplace, but entitled to bring them back in line with their workplace obligations to you, their contractual commitments to you. You're not required just because they went home for COVID to allow them to work forever at home.

In fact, I don't think you should. Sometimes, you should, but in some occasions, I don't think you should. And the reason why is, I think that there are two particular problems that people are missing with work from home at the moment. The first which has become more and more part of the debate is risk. So, as soon as you say yes to someone working from home, their home becomes your workplace for which you are liable for any injuries that they're suffering in that workplace. That's your health and safety obligation. You're required to provide them with a safe workplace.

So, you'll need to conduct risk assessments and so forth for them working from home. Some of you may have got up to speed with that already, but I struggle to believe that everyone is being risk assessing. And I know from our own clients where we found gaps in this, people risk assessing work from home in the way that they should. So, you've got risk of injury and the things that are associated with that that you need to consider with work from home.

There's also the things that flow from that. So, you got the code compliance cost of going and assessing people's home workplaces. You've got the potential workers' comp cost of increased claims, but also increased premiums. I suspect workers' comp insurer [inaudible 00:20:39] if they haven't already. They're gonna need to say, "Hang on a second. This business used to have one workplace. It now has 10 or 15. Surely, their premium dynamic has changed." And so, I struggle to believe that that won't affect premiums going ahead.

And then, finally, I think you're going to end up...and this is spilling into the other problem with work from home is that where you have health and safety needs, you're going to end up spending money on extra equipment for your employees working from home. And that's, to some degree, the hidden cost, I think, of working from home. So, most of you will already have a space for the employee to work in the office, which is where they were before. And you may be coming to some arrangement that they work all or some of their time from home. As their employer, as their master in the master-servant relationship, you're obligated to provide them with their tools of trade. You've got to keep them safe. So, that might mean providing them with an ergonomic chair or a proper desk setup. But you've also got to enable them to function.

One of the big...almost the elephant in the room that I'm seeing at the moment is this. I'm amazed that more employees haven't turned around and said, "You owe me money for my internet bill." And the reason I don't think they have so far is because I think most people have been mucking in and just getting by during COVID. But as soon as those relationships turn into relationships where they are long-term working from home, either full-time or part-time or part of the time, there's a real risk, I think, that those employees turn around and say, "You need to pay for my internet." You turn around and say, "No, no, no. You've already got internet." They say, "Well, I didn't buy that to do work on it. And to be honest, I don't feel like I need it. I'll just do it on my phone for my home streaming purposes and whatever else. And actually, my TV got [inaudible 00:22:37] contract I don't need other than the fact that I work from home." And you might say, "But you asked to work from home." And the quite legitimate response from an employee would be, "But you agreed to it. You said yes. And in doing so, you created a home workplace and you're obligated to provide me my tools of trade for it."

You know, I cannot think of a worse nightmare than being an our case, we've got about 900 people. I'd hate to think that I was gonna be responsible for coordinating 900 home internet plans and having some sort of legal liability for them, let alone the day-to-day cost. But all of those sorts of issues just haven't really bubbled out yet. I'm sort of amazed, by the way, that big landlords have managed to put together a decent scare campaign in the media to say, "Guys, what you don't seem to realize is this whole work from home resolution comes with a cost." It's not costing you [inaudible 00:23:31] unless you're saving money on your office space. If you've got a space for the employee at work, and you're having to pay for them to work from home as well, you're about to get whacked with a big lump of money at a time where you frankly don't need the burden of any extra cost.

So, some of you might have questions about that. I know I spoke about it yesterday on a webinar to a group. I think a lot of people were surprised to say, "Oh, crikey. It might have a hidden cost." And I might end up thinking I was gonna save money and have great staff engagement and retention. But actually, the tail has wagged the dog and I'm going to end up with a big bill for all sorts of things like chairs and IT and internet and so forth that I didn't know I was going to.

So, there's a bit about the end of the office. IR reform, I'm gonna talk about briefly. I always urge people to sort of read papers, the newspapers on IR reform with care. There's so much preliminary debate that goes on in industrial relations reform. You might know that there's been a committee that's meant to be sort of bipartisan or multipartisan just sitting down and talking about how industrial relations should change. I've been quite cynical about that committee, to be honest. I think that they're talking a lot about big business problems, not much about small business problems. They've just released their report on it and they...a sort of classic red tape-y governmental response to it all. These things really frustrate me, I'd say.

They basically said, "Look. They system's so crap," that the only way we're gonna solve it is by having what they call regtech, regulatory technology, which is actually gonna help small businesses understand their obligations. So, instead of actually solving the system, they're doing this thing that I see a lot of more old-fashioned businesses do. And they think that there's some sort of mythical unicorn-y technology thing out there that solves problems, that you can just somehow plug it in and miraculously no one will ever underpay wages again. So, instead of actually going back to the root cause of the problem which is a series of overly complex legislation, modern awards, and solving that problem, they try...they say, "Let's put a technology near over it and that will solve it." I've never seen technology be successful in that way, frankly. That's not how technology works.

I think everyone thinks it's a group of sort of people who have massive brains driving around in Teslas in Silicon Valley that can just magically create technology and solves these problems. We've actually got to go back to the problem itself and solve it. Technology can facilitate that solution, but you've got to go to the root cause of the problem to solve it, which is the modern awards systems broken for small business. It doesn't work.

So, don't expect any changes soon. There'll be lots of debate about that and a group of people that are not business people sitting in a room saying there should be a technology solution seems like a pretty unlikely group to actually solve that.

The second aspect of it is that the Fair Work Commission came out during the week and said that they suggested more flexibility in awards, which seems to be something that's been well received by people. I think there was a 12-page draft clause to amend awards. Again, missing the point. To be honest, that level of complexity only shows how rigid the system is. The system does not work in modern workplaces that might have been affected by the coronavirus crisis, but also might have more and more impacts like this in the future where we need flexibility. We don't need rigidity, which is what the current system provides. So, there's a lot going on which is not really new news to say that the current system doesn't work. But I don't foresee any imminent changes to that that actually can help you out with small business owners. So, that's stuff on IR reform.

Finally, on Victoria. You know, I'm not a new service here and I can't tell you what's going through Daniel Andrews' mind. But what I am doing here for our business is preparing for the worst, as I always have been. And I'm staying true to that. My expectation is therefore that they're gonna have some form of extension of their current lockdown process. And I'm trying to make sure I'm prepared for the fact that we're gonna have a group of people that are going to be stuck at home, which operationally will mean that they might not change things much. But with my hat on as an employer and someone that cares about our people, I'm very worried about them being stuck at home and what that does to them psychologically. And we're trying to do things here in the business to help keep them engaged and as optimistic as can be, going through that time. But let's watch the space and see what happens at the moment.

There's some talk about...rumour about some form of traffic light system by which Victorian businesses might be able to reopen. But amongst all the other complexity, that just sounds a bit of a worry to be just trying to work out JobKeeper 2.0, let alone trying to distill yet another traffic light system which tells you how you're going to operate. But let's not speculate until we see something over the course of the weekend.

So, that is it for me in terms of my chat. Stewie [SP], over to you in terms of some questions please.

Stewie: Ed, a couple of comments to start. Wayne says, "Is that the COVID bat behind you?"

Ed: It is. Yeah. Everyone mocks my fancy piece of artwork. I thought it was quite sort of cool and showing me to be a multifaceted [inaudible 00:29:22]. Yes, it is the COVID bat, as it's become known.

Stewie: This is coming from Karen. "Oh, Ed, Ed, Ed. After spending lots of time with your staff this week, I thank you. A casual on JobKeeper refusing work says she can stay at her home and keep getting paid!"

Ed: Oh, Karen. I feel for you. You're not the first person to suffer that, won't be the last with JobKeeper 2.0. You know what? It gives me a good reminder to use that mantra that I hope we're all starting to use in our business, which is, don't bury your head in the JobKeeper sand. If you got some difficult decisions about who you actually need to do work and when, don't wait for JobKeeper to end to make those decisions. That's the way you wrestle back control of those sorts of situations. Really critically analyze your business needs in terms of your staffing needs.

Stewie: And Ed, just a comment from our esteemed colleague. There will be some financial questions today. It's not our area of expertise, and we do encourage people to speak to their accountants and registered tax agents. But we'll do our best on what we know.

Ed: Great. Yeah. We will. And in that sense, I suppose we're, as a business, getting to grips with the rules as we understand or the legislation as we understand them. So, really, we're just telling you what...providing resources, what you might find online yourself. If you need specific advice from your accountant, please go and grab that.

Stewie: Thanks, Ed. And just to kick it off. This is from Rory [SP]. Can you define legacy JobKeeper for me?

Ed: I can try. So, legacy JobKeeper. And this is something we're having to work out ourselves. You know, if you are a business currently on JobKeeper, you're getting JobKeeper 1.0. You are then able to access all the kinda legacy JobKeeper business if for the quarter up to the end of September your GST turnover is down by 10%, but not by the 30% that would be needed to become a JobKeeper 2.0 business. What does that mean for you? It doesn't meant that you get any financial benefit. That's a classic one that's really quite a muddle here. On the one hand, it's a financial question and you're needing to know if you're a legacy business by having the 10% reduction in turnover. But the consequence of being a legacy business is really an employment relations consequence, which is, if you are a legacy business, then you get the access to certain JobKeeper-enabled directions, which means that you can manage your staff in certain ways that you're not normally allowed to do.

The classic one is that you can stand people down unilaterally, albeit that what that actually means as a legacy employer is you cannot remove more than 40% of someone's time that they were working for you prior to the 1st of March 2020. So, you can only do a 40% hour reduction and there are certain extra notice requirements about that.

Now, what does that mean? Sorry I'm extending beyond the boundaries of the question. What are the areas or the pitfalls that we're gonna see regularly is this, is that you are perhaps a JobKeeper 1.0 business. You must be if you're going to end up being a legacy business. And maybe you've got some employees that are fully stood down at the moment. Maybe they're 38 hours a week, but they're not doing any work for you. They were doing 38 hours a week before the 1st of March, but currently, all you're doing is handing over to them $1,500 a fortnight to sit at home.

Now, as at the end of September, JobKeeper 1.0 finishes. So, in principle, they are no longer stood down. And the day after, you've got to work out whether you are a JobKeeper...sorry, a legacy JobKeeper business. In which case, you would be able to bring them back for anything over 60% of their ordinary hours, anything over 60% or 38 hours. You couldn't carry on keeping them on zero hours. You'd have to bring them back for at least 60%, which you might be saying...I'm sorry it's unpalatable to me, "I don't have the money," because you're not getting any JobKeeper anymore. So, you're being now told you have to switch them back on as an employee, essentially, for at least 60% of their time. And you're gonna have to fund that.

So, you might have some tricky questions that flow from that. You're gonna say, "I don't need them to do that role anymore." In which case, you're gonna have to start considering redundancies, and I urge you to do that soon because otherwise you're going to end up paying people to do at least 60% of nothing for that period whilst you go through a redundancy process, and you're gonna have a cost. If you get on with it now, you can actually use the remainder of the JobKeeper period to make those sorts of decisions.

Stewie: And Ed, this one keeps popping from week to week, this time from Liz [SP]. "We're in a process of a business sale. And a number of our staff are transferring to the new owner. As they are currently receiving JobKeeper, does this go across with them to the new owner?"

Ed: There are specific rules for the new owner to worry about. You wouldn't carry on paying them JobKeeper, but there's a specific qualification process if businesses are purchased. So, I believe that's the new owner to worry about and they can speak to their own accountant.

Stewie: This is from Mark. He's a client. "I have an employee who has overdrawn in sick leave entitlement that have just taken two days sick, knowing that they will still be paid through JobKeeper. Are we able to deduct from annual leave entitlement, for example?"

Ed: You're not if they say that they were sick and they were away on sick leave. Particularly, if they're certified, then unfortunately, that's the sort of loophole in JobKeeper that someone can be on unpaid sick leave but be receiving JobKeeper and actually paid. The loophole which too many people have worked out by this stage, to be honest. So, we're seeing that quite a lot where people are...let's say they don't want to turn up to work. Instead, they just say, "Well, I'm sick. I can't turn up." They get doctors to sign them off. Because they're JobKeeper eligible, you're left having to pay over JobKeeper for them to sit on their...they call it jacksie in England. I don't know if that's the phrase [inaudible 00:35:49] backside. Okay. Yeah. Good. That's a technical phrase. Not sure that's in the JobKeeper legislation.

Stewie: Ed, this is from Veronica. A variant of a question we're getting a lot today, a bit of a financial question, though. "For future eligibility, we are looking for a 30% downturn in comparing September 2020 quarter to what other period?"

Ed: So, the legislation says September 2020 to the same quarter of the year prior. Year on year, you're looking at. So, the big change is, yeah, under the JobKeeper 1.0 you can forecast the downturn. This is actual September quarter versus last year.

Stewie: Right. Ed, there's one from Susie. "What does it go down to in January?"

Ed: If you are eligible, then for full-time employees, it goes down in January to 1,000 bucks a fortnight from 1,200 at the start of October, for the October forward quarter. And 650 for 20 hours or less.

Stewie: And Ed, we're getting variations of this one, too. This is from Dianna. "So, we're on JobKeeper now. Is it still a predictive 30% loss or is it now only 10%? Turns out we did better in August than we thought. Is this a problem?"

Ed: Don't worry about August now. If you're already on it, you're on it. So, you're entitled... Remember we talked a lot back in the day about once you're on JobKeeper, do you stop going on it when it turns out things are going better than you were worried about? The way JobKeeper 1.0 works is as long as you legitimately forecast your reduction in turnover, then you keep JobKeeper even if as you see in the newspaper some companies have actually don brilliantly and better than they did last year and so forth. But they're still getting JobKeeper. So, that doesn't get switched off because you end up outperforming. So, JobKeeper for August and September will carry on if you're already getting it.

Stewie: Ed, Pam asks this. "Where would we find more information on the Rossato decision and eligibility for casuals entitlement to paid leave? It talks of retrospective. Does that include casuals that are no longer employed? How retrospective is this?"

Ed: Yeah. No, it's spot-on. It's a mess at the moment. In theory, you are retrospectively liable for your casuals, including those that are no longer employed. There's a limitation period on how far you can go back for claims, which is typically six years. So, in theory, there's a six-year back pay issue for current and ex-employees who are casuals falling within the Rossato decision. There'll be, I'm sure, a blog on our website to have a look at what that means.

It's a pretty technical issue though. You want to really start to understand whether you should be properly categorizing your people as Rossato casuals. And also, importantly, you need to understand what your financial position is. Again, I'd urge you to speak to your accountant. It may be that you're needing to provision in your accounts for liability even if you're not paying back those employees at this stage. My position is being in general that I wouldn't be rushing to paying back those employees because this is going through the high court. It would take some time to do that.

You might have employees that are wise to what's going on, coming to you and saying, "You owe me money." And technically, you do at the moment. But what you would be saying to them is, "It may well be the case that I do, but we're waiting to see what the high court decision says." And we obviously abide by the law as to whatever is said after that. Are they gonna struggle to accelerate payment any quicker than that? They might have a crack at trying to sue you. You'd frankly be going to court and saying, "Can I wait for the decision on the Rossato please?" And I think everyone would say yes. So, the reality is, I wouldn't rush to paying people back until the high court decision is being concluded, which won't be until next year.

Stewie: Ed, Jackie needs a little recap on what you were mentioning a little earlier. She asks, "Can you request that if employees want to work from home they have to supply their own equipment and pay for their own internet if they have an office or desk setup?"

Ed: Good question. Yeah. That's sort of what we've done during COVID and to some degree what we'll carry on with. And I think a lot of employers are quite surprised when I've been saying this because they're saying, "Well, that...I've got the setup here and they're just choosing to work from home. It's up to them." That's when this master-servant thing comes back in. So, you might feel like as an employee just allowing someone to do it, but in reality, what you're doing is agreeing to it. And you're agreeing, therefore, for that home space being their workspace.

I suppose you could say to them, "You cannot work from home unless you have the equipment at home to do it." And the answer is, "I don't. Can you buy it for me?" you might say, "Well, okay. Then you need to come back into the office. I'm not buying equipment for you." But if you're gonna allow them to work from home, you agreed for them to do it, then there is a risk...first of all, an obligation to make sure they're safe in doing so. So, you can't just let them sit on a bean bag with a laptop on their lap because it might result in workplace injuries. But second to that, you might end up with some mess in the future about, "Well, you know what? You guys, I've been using much more data than my allowance because of work. You guys have got to provide me with expenses related to my work. That's what my contract says. So, you need to pay for my internet or some of it," and so forth.

So, it's a bit of a minefield. The best I can suggest at the moment is to get some clear advice on it. Make sure your policies relating to flexible work or home work are very clear.

Stewie: Ed, there's one from Kristine [SP] with a few people following it. "With JobKeeper 2, how do we classify our employees on maternity leave as they have not worked at all? Are they entitled to payment at all? If so, would it be part-time rate or full-time rate?"

Ed: So, if they're on maternity leave but not receiving some parental leave benefit and therefore a JobKeeper so you're looking at the basis upon which they are employed which underlies their maternity leave. So, what does that contract say? You know, they would be full-time or part-time based upon their...whatever their engagement is even though they're on leave.

Stewie: And a phony issue for Joanne. "We have an employee who is just not coming to work and saying they are sick. They're not providing a certificate, but as they are a JobKeeper, they still get $1,500. Can we do anything about this?"

Ed: You can if they're not providing a certificate and you've got a policy in place with regards to when they're meant to provide that and so forth. Then you could start escalating that into a disciplinary process. Not gonna be a particularly rapid process. You'd have to invite them to meetings and so forth. But if they're simply refusing to engage with you and the proper sickness process, then you could end up disciplining and potentially even dismissing someone in due course. But you don't do that and click your fingers. Unfortunately, you have to go through a due process.

Stewie: From Greg and Bernie and Kent. "Hi, Ed. Who is liable to repay the overpayment of JobKeeper claimed in respect of an employee who is on maternity leave when the employer knew the employee was on maternity leave at the time? So, the employee has received both."

Ed: Okay. So, if they're on maternity leave and they were receiving some form of parental pay benefit and therefore shouldn't have got JobKeeper, technically speaking, you signed a form saying that this is an eligible employee and I want money for them. So, in principle, you guys, it's now in the employee's hands. So, what I'll do, just belt and braces, is flag it with the ATO and say that, "This is what's happening. What do you want me to do about it?" I suspect in the context that they're not gonna ask you to do much, but I don't know. To be honest, I'd go and ask them. And then if they say, "Pay it back," then you'll need to go to the employee and ask for the money back. You can't just take it off them in their future pay, by the way. That would be an unlawful deduction of wages. You have to get their permission.

Stewie: Okay. Thanks, Ed. This is from Jenny. "Hi, Ed. I have an employee working from home who seems to have suddenly developed a back and neck issue, and is off to see the physio. I'm worried that he'll try and blame it on his workplace setup, which is really just his home office or couch, for all I know. Am I liable in this situation?"

Ed: Potentially, yes, unfortunately. You've got an obligation if they've been working from home and that's been the arrangement with you. You've got the obligation to provide a safe place of work and that would involve going through a process of doing a risk assessment either by having an expert visit them or having them go through a remote assessment. If that hasn't been done, then that employee has been working in a way that is unsafe even though that might not have been your instruction, but it's been essentially under your watch even though you can't see him. Then there is a risk that you end up with a workers' comp claim. Yeah.

Stewie: And this is from Julie. "Regarding alternative rules for JobKeeper 2.0, do they exist this time around?"

Ed: I think they will. I've not seen anything that expressly says that, but I think they're gonna have to fiddle around with how those alternative rules work in terms of being... You'll remember that they're all to do with when you started your business and whether your business was purchased and so on. You're gonna have to shift some dates around to make sure that those alternative rules are effective for JobKeeper 2.0.

Stewie: This is from Cathy from Cheeky Monkeys. "Have you heard any whispers what the government may be doing to assist childcare businesses after the 27th of September? This is the date we are cut off from any assistance. Why has childcare been targeted when we are classed as an essential service? We're down over 50% in attendance still at this stage and after this day, I'll need to reduce staff. Such a waste after spending six months with JobKeeper to save their jobs and now I'll need to let them go. It's so sad.

Ed: Yeah. It is very sad. Cheeky Monkeys, good to hear from you again. It is very sad. It's frustrating. It just sort of feels like there's some torture [inaudible 00:46:32] going on there. I suspect, you know, the industry body has been involved with pushing hard to get the additional subsidy which is then led to the retraction of JobKeeper, which then, to my knowledge...I'm sure, you know, there are people at the center of the industry that are working hard to work out whether you're gonna get JobKeeper 2.0. But in the moment, you do feel a little bit exposed. You're not the first person to ask it. And if you're asking me, then other people will be asking in the corridors of power as well. And we should hear something soon, I'd say. But I can't believe anyone's intention is to disadvantage such an important service in our lives.

Stewie: This is from Caroline. "I have a staff member who I would have loved to have kept, but he was on a partner visa. His permanent visa has now come through. Could I get him back now on JobKeeper?"

Ed: Potentially, yeah, depending a bit on how long they were away from work. And you're essentially reemploying them. You need to check JobKeeper eligibility rules. Maybe they're gonna eligible for 2.0 anyway. So, yes. Yes, potentially. You need to check the eligibility stuff with your accountant.

Stewie: A fairly broad one from Shauna [SP]. "How does JobKeeper and maternity leave work?"

Ed: So, you can't basically double dip, is the basic principle. You can't get maternity pay or some sort of parental pay and JobKeeper. So, you need to declare that you are receiving that pay to your employer so that they didn't get away and provide you with JobKeeper as well.

Stewie: Time for one more?

Ed: Sure. Sure, sure.

Stewie: This is from Deb. "Hi, guys. How do we determine what JobKeeper 2.0 level an employee will be if they were on annual leave the whole of February? She's a part-time employee."

Ed: It will be based upon their contractual arrangement. If they were doing...they're on variable hours, I suspect we'll get some guidance on averaging or something like that. But typically, it would be on their contractual arrangement if they were on 15 hours a week. Then they're going to be on a lower amount. That will be the way that will work.

Stewie: A couple of comments.

Ed: You know, [inaudible 00:48:52] as usual. I'm a bit fragile, but [inaudible 00:48:56]. Don't need any [inaudible 00:49:01].

Stewie: These are brilliant. JC [SP] says, "Thank you, Ed. Your generosity in providing these webinars and seminars is greatly appreciated."

Ed: Thank you, JC.

Stewie: And then I'll scoot to this one, from Wayne. "Thanks, Ed. Happy father's day to all the dads for Sunday."

Ed: That's good. Good. I hope that my children remember, Wayne, just as you have. But we shall see. So, thank you, guys. And happy father's day. And see you next week. Please keep asking questions on here. We've got our advisers. Then finally, just before we go, have a look online and look on our website. I think the link has been provided as well to JobKeeper 2.0 guide, which is available to you all for free. Cheers.

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What Is the Minimum Wage in Australia 2020?

For most employees, the minimum wage is set by the award that covers their industry or occupation. The national minimum wage as of 01 July 2020 for Award free Employees as determined by the Fair Work Act 2009  is currently $19.84 per hour.  This can differ for Award free Employees in Western Australia under the WA State System.

What is the Minimum Wage for a 16-year-old In Australia?

Some employees have a different minimum wage depending on their age. A junior is an employee under 21 years of age.

Juniors get paid a percentage of the relevant adult pay rate unless the award, enterprise agreement or other registered agreement doesn't have junior rates.

The percentages that apply are usually based on the employee’s age and increase on their next birthday.

What Is the Minimum Casual Wage in Australia?

Casuals are entitled to a 25% casual loading, and as the national minimum wage for Award Free Casual Employees is currently $19.84 per hour, this means that the minimum casual wage is $24.80 per hour. Again, this may differ for Employees in Western Australia.

How Must I Pay My Employees?

Employees must be paid with money. They cannot be paid fully or partly with food or other goods.

How Often Do I Have to Pay My Employees?

Most Modern Awards, enterprise agreements or employment contracts will set out how often employees must be paid – whether that’s weekly, fortnightly or monthly. If this term isn’t stipulated, then employees must be paid at least monthly.

Can I Reduce an Employee's Pay for Poor Performance?

No. Generally, you can only reduce a Employee’s rate of pay if they agree to it. You cannot reduce the pay rate below the minimum standard for their job in their Award or Enterprise Agreement or below the minimum wage.

Do I Have to Pay Employees That Are On A Trial Period ?

An employer might ask a person to do an unpaid trial while they evaluate them for a vacant job. This is used to determine if the person is suitable for the job by getting them to demonstrate their skills. The trial can be unpaid if it is necessary to demonstrate the skills for the job, and the person is supervised at all times. Depending on the nature of the job the trial can last from an hour up to a of one shift. Any period beyond what is reasonably required to demonstrate the skills required for the job must be paid at the appropriate minimum rate of pay.

Employers can also put their employees on a probation period to assess if employees are suitable for the role and business. While on probation, employees continue to receive the same entitlements as someone who isn’t in a probation period and need to be paid for any hours worked.

Do I Have to Pay An Employee That Is Doing Work Experience ?

Work experience or internships can be unpaid if the person doing them is a student, or if it is part of vocational placement run by an educational and training institution as a requirements to complete the course, and there's no employment relationship. If the person is actually an employee, they are entitled to pay and conditions under the Fair Work Act. There are a number of factors that determine if the person is an Employee so please call the Employsure Advice Line for further advice.

Do Employees Have To Be Paid For Attending Meetings Or Training ?

Yes, employees must be paid to attend training that is needed for their job. They must also be paid for meetings involving their regular work (e.g. team meetings).

Do Overseas Employees On Working Visas Get The Same Pay Rate As Other Workers?

Yes, employees who are not citizens but are legally working in Australia on visas or otherwise are still covered by the Fair Work Act 2009. They must receive the same pay rate and other entitlements that other employees receive.

What Happens If an Employee Believes There Has Been An Underpayment ?

The Employee should speak to their Employer and explain why they think they have been underpaid. The Employer should look into it, calculate any amount that may be owed to the Employee and back pay  that amount as soon as possible and record it in the Employee’s pay record.

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