Following weeks of speculation, Treasurer Josh Frydenberg released an announcement late on Friday afternoon regarding clarifications to the JobKeeper eligibility rules.

Furthermore, the ATO released guidance over the weekend advising an extension to the enrolment period for the opening two fortnights of the JobKeeper scheme.

Whilst the changes are not yet law (this is expected within days), the key components are as follows:

• Businesses now have until 31 May 2020 to apply for the first two JobKeeper fortnights (ending 26 April 2020).

Whilst this 5 week extension is welcomed, it is stressed that the wage condition (i.e. the payment of $1,500 per fortnight to employees for the first two JobKeeper fortnights) must be paid to employees by 30 April 2020. Where businesses are still unsure of their eligibility (noting the unlegislated changes below), this condition will lead to a risk of paying amounts to employees which may not be reimbursed. We await confirmation from the ATO and Treasury as to how this will apply in practice.

• Service entities which do not satisfy the basic decline in GST turnover test, or the alternative tests prescribed last week, will be provided with an additional test to assess their eligibility for JobKeeper purposes.  This test has not yet been legislated, however the Treasurer’s announcement refers to assessment of the “combined GST turnovers of the related entities using the services of the employer entity”.

We will provide a further update once this legislative instrument is released.

• Charities (excluding schools and universities) can now elect to either include or exclude government revenue from the JobKeeper turnover test.
• Religious practitioners may now be deemed as “eligible employees” of the religious organisations to which they are affiliated.
• The “one-in, all-in” concept has been reaffirmed and will likely be included in the clarifications to be received.  Employers are not allowed to pick and choose who they nominate as eligible employees for JobKeeper purposes.
• The JobKeeper eligible employee criteria will now exclude full time students aged 16 or 17 as at 1 March 2020 who are not financially independent. The Treasurer’s announcement advises that this will apply prospectively – ensuring businesses are not out of pocket for amounts paid to these particular employees in the first two JobKeeper fortnights.
• There will be some minor changes to eligibility rules for International Aid Organisations and Universities.

As can be seen, what were the rules for JobKeeper yesterday, may not necessarily be the same tomorrow! Stay tuned for further updates this week.

As always we are here to help in this ever-changing environment – please feel free to contact your ESV Engagement Partner if you have any queries relating to these recent changes, or any aspect of the JobKeeper scheme.