Rightio, trying to wrap my head around this, so bear with me…
I am really happy that the government has finally done something more than just bail out Qantas, and I hope this JobKeeper will actually help many employees who have been sacked or are in terror of losing their jobs and of course those businesses which this may help survive, or at least be able to survive once we return to a better operating environment.
Having said that, I have many questions and many reservations.
We have all seen the front pages this morning and media talking heads love to announce the announcement – yes, like everything else the Govt has done so far to address COVID-19, it is just an announcement, it has not gone through Parliament and it could still change by the time anyone can benefit – of a “jobs subsidy package costing an eye-watering $130 billion”.
You can register your interest for the “JobKeeper payment” on the ATO site, ato.gov.au
For detail, well very limited detail you can visit ‘The JobKeeper Payment - Supporting businesses to retain jobs’ on the Treasury site, though be aware, the fact sheet is pretty light on detail, so hopefully many of my reservations will be addressed at a later date or fixed once ALP & Greens actually get to see detail prior to voting on it in Parliament.
Though, it has to be said, that is one of my reservations, even if either ALP or Greens do raise issues (as they did with Austudy/Abstudy being left off original JobSeeker package & able to get Govt to include), I can’t see them pushing too hard, as obviously, with all the lauding of this “staggering rescue package” none will want to look like spoilers holding up much needed help SIGH!
Anyhoo… My questions/reservations
3 Tier Welfare system:
I was already unhappy about government trying to distinguish between those who were already on NewStart and then relabelling to “JobSeeker” for those ‘new’ unemployed, as though they were more worthy than those already on the absolutely punishing Newstart. This was wrong, it was divisive and worse, we know the Government will most likely go back to the ‘punishing’ poverty levels of Newstart as soon as this virus is tackled and we are back to business as usual.
NOTE: Those on Newstart prior to re-vamped JobSeeker were also there “through no fault of their own” and just as unfortunate, shame both politicians and media did not respect that prior. Distinguishing between the two different periods of unemployment is divisive and reprehensible.
Now we have added a third tier, the “JobKeeper” payment.
Personally, I feel the government is doing this just to make the unemployment figures look better as those receiving this payment will be getting it from their Employer, via the ATO, not via Centrelink, but make no mistake, for many employees where the business has pretty much shut up shop or in ‘hibernation’ as government likes to say, it is a ‘welfare payment’. It is only slightly higher than the newly raised JobSeeker, the only difference is you have to deal with your employer instead of Centrelink.
Now… for many, obviously dealing with your employer will be a much more pleasant experience than the punishing Centrelink regime. For some… for some it may not? More on that later…
But do we now have an even more divisive system? Where some may feel more superior to their fellow laid off employees (some in same business mind you) because they are not on the ‘dole’, due to different payment method?
Having said that, as the government is really just outsourcing welfare to business, which, let’s face it, this government loves to outsource government services to private enterprise ARGH! the idea that Employers are now deciding who, when and how you receive government welfare via them really smacks of a feudal style vassal status to me and that makes me very uncomfortable? As a principle, Business should never be deciding or doling out welfare.
Three tiers of welfare to laid off employees is really not good, it is complicated and will seriously have all sorts of ramifications once this period is over, or in 6 months time if the governments estimates for programs is anything to go by?
Supporting businesses to retain jobs:
This is the phrase government is using as to why they are outsourcing this welfare support to business:
“The JobKeeper Payment will support employers to maintain their connection to their employees. These connections will enable business to reactivate their operations quickly –without having to rehire staff –when the crisis is over.”
In theory, this is a great idea. I know many who have had the horrible job of going through staff, finances and working out how to ‘stand-down’ and/or ‘make redundant’. As one friend said “we just had decades of experience walk out the door in tears today”. So the ability to keep a relationship with them as you will be able to pay them, even if less money, as you are the proxy for a government payment is a good thing, probably better than having to line up at Centrelink for your employee.
This however makes the employee indebted to the employer.
Sacking an employee and being sacked, regardless if unavoidable is a pretty traumatic thing. Emotions run high and I’m not sure some employees will want to keep dealing with that company, but may be forced to as better than dealing with Centrelink? Even if they have to speak to “that useless Finance bloke who kept his job when didn’t deserve to but he plays golf with the boss” to set this up or… as will most likely happen, when there are issues, rely on them fixing it for you.
There may also be some employers who will abuse this.
Will some business who have put people on a Long Service leave scam the system by continuing to pay Long Service weekly (instead of as a lump sum as they should) which some businesses are doing with those who had a lot accrued and then claim this as paying their employee and then get a free subsidy from government for something that is not a JobKeeper as such, just a bonus for the business?
What happens if an employee is worried, as in partner also out of a job so they demand their long service in full, as is their right, but business decides, well, stuff that, will put on another staff member if have to pay that out, plus, pay you weekly as being part of the JobKeeper scheme?
Call me cynical, but as a former ATO employee I can’t help but see the gaping hole in the #jobkeeper scheme. We’re trusting the same businesses who commit wage theft of $3.6b/yr not to skim any off the top during an economic downturn - with almost no oversight. 🤔 #auspol— Liz Barnes (@slizardofaus) March 30, 2020
Now to choices… Everyone knows that no-one wants to deal with Centrelink so you may have some bosses that will hold that over employees heads and in these ‘rules thrown out’ times could be forced to assume employment roles they don’t want to do, not qualified to do, or just very uncomfortable doing but after seeing and hearing Centrelink horror stories will feel they have no choice but to comply with unrealistic demands just to keep some money coming in that doesn’t involve jumping hoops at Centrelink? Ie I will keep paying you but you have to babysit my kids, do deliveries in your own car (that you worry is not fit for that purpose), answer phone calls from overseas on a midnight to dawn shift from home (when you have 3 kids trying to sleep) etc…
This also leads to an issue as to what happens if this does happen to you and finally you can’t cop unreasonable demands and quit yourself?
Will Centrelink make you wait months – that you can’t afford – to go onto the JobSeeker payment?
And while on that JobSeeker payment… We have been told you can’t receive both, which is obvious and a fair call and Government made out like you can just contact Centrelink and “transition” over to the JobKeeper system? Sorry, but if you have ever dealt with Centrelink, NOTHING is ever that simple, nothing every happens with just a simple phone call. I worry people will be harmed at a later date due to cross-overs on dates of payments from one programme to the other at a bare minimum.
Like everything this government had done, it is too late.
“Nearly half of Aussies living paycheck to paycheck”, 46% of Aussies could only live a month or less on their savings if they lost their job AND "A startling 2.1 million are living day to day, predicting they could only make ends meet for a mere seven days or less should they be laid off or not be able to continue working."
This really matters. The government has been very aware of this virus coming since early January, we knew they were taking it seriously – and happily avoiding sportsrort scrutiny – by declaring a pandemic on the 27th of February. It is now 31 March and not one person has actually received any money, any assistance and yet many lost their jobs, or had their business failing prior to February. Hell, media don’t like to remind punters but the economy was already tanking prior this pandemic.
IF nearly half the population can’t live for a month if lose job with a shitload of them not being able to survive 7 days, well, getting JobSeeker at the end of April is not good enough.
A small/micro business that was already struggling, could already be pretty much shut down with restrictions sure as hell does not have the cash flow to pay employees they would like to keep on $1500 per fortnight now, to wait until May (we don’t know when in May as yet, assume later in month) to get reimbursed by the government?
Or will there be changes to what we see already and you can just say now as a business that you nominate Joe & Jill, you can’t pay them, but you will when you get paid by Govt in May?
Somehow I can’t see Govt thinking that is ok, not to mention, weeks matter, hell, days matter, so would an employee even want that if they know they can at least get their shitty Centrelink payment on the 27th of April?
As a side note. With both waiting times, how many are already homeless? And… I am not just talking employees but small business owners, sole traders and contractors too?
Another factor is many small businesses have already shut up shop, paid out or walked away from their leases a week ago. As I said, many were already struggling, then the Government just mandated that many were no longer allowed to operate, so of course settled up their affairs and shut up shop. I can't see these businesses, going through the effort of bothering to try to keep up the admin side of a business they are not physically operating, and jumping through any ATO paperwork & payroll hoops, just to ensure some staff get a slightly higher rate than the JobSeeker rate? This JobKeeper should have been announced BEFORE the government mandated the shutting down of so many businesses.
Government doesn’t understand Gig Economy:
I am glad the JobKeeper programme includes sole traders and contractors. Love how we have all this terminology but face it, freelancers, contractors like uber delivery etc are all pretty much sole traders, or as we used to say back in the old days “self-employed”.
These people, of who there are millions, do not have a finance team on staff, they don’t have access to accountants, or can’t afford them and most often don’t even report income to ATO as a ‘business’ but just a personal tax return. Will they even be able to prove their earnings are 30% down? Because they will be under so many reporting thresholds, will they even have the relevant paperwork that ATO would accept? For many, an upturn or downtown for the month for them is whether they can afford to fix that stove or go out for drinks? Not a spreadsheet.
For many creative type industries they will also have the issue of erratic payments. For many, they may earn next to nothing per month but due to contracts or commissions, may do a few larger jobs per year that spread out keep them in food. If you happen to have received payment for one of those ‘odd’ jobs during March this year, which means you are not down 30% on last year (even though prior months were almost zero income) you are not eligible for this JobKeeper?
Can you apply then in April, or even in May? As then you can prove the 30% downturn?
We don’t have answers to that as yet?
As this payment is a ‘reimbursement’ as such. Does this mean that as a sole trader or contractor you have to pay yourself at least some form of payment until May so that you can even get that money back from ATO? I know you can reduce pay, but hell, will Government accept a wage of $1 a week coz that is all you have after paying food & rent? This is the situation for many, from beauticians to massage therapists and other service industries that were already struggling since word hit this nation about the virus at the end of January. They were already in trouble before government announcement shut them down.
As a side note: Some of these sole operators are already in massive trouble and not just because they had barely earned a cent in last 2 months, but now they are shut down, besides the worry of paying rent/mortgage (though actually luckier if have mortgage as that can be deferred) they now have issue of commercial landlords demanding their rent. In some cases threatening to apply legal action due to termination of lease etc., for businesses that can’t even use the bloody space ARGH! This should have been addressed at the same time those businesses were shut down by Government decree.
Anyhow… I have a lot more questions – and reservations – but until this goes through Parliament and we see actual nitty gritty of legislation and how it will be applied it seems to me this is the same as every other ‘announcement’, more complicated than it needs to be and too bloody late with too much of a delay on when you physically receive that assistance in your hot little hand.
Glad big business with cashflow will benefit from this, I really do. Good on those employees who have higher wages and savings so they can also benefit from JobKeeper once it finally kicks in.
But… For the many, the millions! Who don’t have more than a weeks savings, both traders and employees, well… Sorry, you should probably still hit Centrelink and cross fingers you can maybe escape that hell-hole if this program turns out to be eligible to you.
PS. Can almost guarantee I will probably add more questions to this as weeks go on – we don’t even know when Parliament will be sitting to vote on this package, so yeah, could be weeks 😞
If you are a boss, have a boss, or had a boss and are keen to get your boss back, you get money. How Stimulus design entrenches boss/worker dependency. There is only 1 income model ... an employment relationshiphttps://t.co/znTe7O0cne— 💧Michael West (@MichaelWestBiz) March 31, 2020
MEDIA RELEASE: The govt must clarify and if necessary amend the eligibility criteria for its JobKeeper subsidy to alleviate concerns that a large proportion of the freelance arts and entertainment workforce will fall through the cracks. https://t.co/0a7Oc7BOla #noworkerleftbehind pic.twitter.com/wdpZyY4B9Y— MEAA (@withMEAA) March 31, 2020