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Businesses receive reduced JobKeeper payment to start 2021

Businesses will start the year with reduced payments of the JobKeeper supplement as part of the second phase of the scheme's extension period amid calls for another extension beyond its scheduled March end date.

Businesses receive reduced JobKeeper payment to start 2021
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  • AFlores
  • January 05, 2021
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From 4 January, eligible businesses receive $500 per week for each staff member working at least 20 hours per week, down from $600. Other employees attract a payment of $325 per week, down from $375.

The extension period will run until 28 March 2021. During this period, the Tier 1 rate will decrease from $1,200 to $1,000 per fortnight, while the Tier 2 rate will reduce from $750 to $650 per fortnight.

The Tier 1 rate applies to eligible employees who worked for 80 hours or more in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and eligible business participants who were actively engaged in the business for 80 hours or more in February and provide a declaration to that effect.

The Tier 2 rate applies to any other eligible employees and eligible business participants.

However, in a recent MyBusiness webcast, the Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, expressed hope that the government would find value in extending the JobKeeper wage subsidy for businesses in distress, beyond the current 28 March 2021 hard cutoff date.

“JobKeeper got small businesses with less than 20 employees back to almost the same levels of jobs as pre-March by the end of September. But by the second week of November, there’d been quite a significant reduction in jobs again. And I think that is probably because as people came off JobKeeper, they had to reassess their cash flow, reassess their business capacity to keep people on their books,” she said.

“But medium to larger businesses are tracking along quite well. So, I think what we’re seeing is what I talked about before and that’s businesses as they come off JobKeeper having to really reassess the number of staff they’ve got. For many of them, they cannot afford to pay and that will result in a reduction in employment.”

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