UPDATED 15/10/2020

The JobMaker Hiring Credit is available to eligible businesses for eligible employees, and aims at creating jobs, but how does it work? What are the practical concerns when it comes to employment and privacy concerns. Can you offer a position to persons of a certain age or status without triggering discrimination concerns? This weeks HR Highlight explores this new Federal Government Scheme and its potential relevance to fuel industry businesses.

JobMaker Hiring Credit

The JobMaker Hiring Credit provides an incentive to businesses to hire additional young job seekers with a view to creating jobs as the economy recovers.

Eligible Businesses will be able to claim $200 per week (from 7 October 2020) for each Eligible Employee that they employ in a NEW job aged 16-29 years, and $100 per week for each Eligible Employee employed in a NEW job aged 30-35 years.

Payments will be made quarterly in arrears through the Australian Tax Office. Payments will be made for 12 months from the date of employment, provided the Eligible Employee is employed before 6 October 2021.

The Claims for the Credit must be equal to or less than the amount actually paid to the employee.

The first set of Claims for the JobMaker Hiring Credit will be able to be made through the ATO from 7 December 2020.

What is an Eligible Business?

Businesses other than those that are; (a) receiving JobKeeper Payments, (b) in liquidation, or (c) have entered bankruptcy or are subject to the major bank levy are eligible for the JobMaker Hiring Credit.

To be eligible to receive the JobMaker, a business will need to;

  • Show that the job is a NEW job
    • This means that the position was created after 30 September 2020 and is actually an in the increase in the actual number of employees. The employee headcount at 30 September 2020 is known as the ‘Baseline Headcount’ that will be used to assess eligibility
  • Show that the job has resulted in increased payroll
    • This means that the total PAYG reporting has gone up. This is to ensure that the job is indeed a new job and not simply a new employee sharing/cannibalising hours from existing staff
  • Show that the job is at least an average of 20 hours per week for the full 3 month reporting period
  • Show that the actual employee in the job meets the employee eligibility criteria (see below)
  • Have and retain detailed records of the hours of work undertaken by the employee along with all pay records
  • Have an Australian Business Number, be up to date with tax lodgment obligations, be registered for Pay As You Go (PAYG) withholding, and be reporting through Single Touch Payroll (STP)
  • Report quarterly on eligibility

Note: New businesses, that did not have a headcount of employees at 30 September 2020 will also be eligible with the base headcount set at one employee.

What is an Eligible Employee?

One of the key elements of the JobMaker program is that it is targeted at young people who have been receiving job seeker assistance. In order to be an Eligible Employee the employee must;

  • Be within the age range (16-29 years Tier 1, 30-35 years Tier 2)
  • Have received ‘assistance payments‘ in at least one of the three months prior to employment. ‘Assistance payments’ include; JobSeeker Payments, Youth Allowance (Other) or Parenting Payment
  • Not be the subject of the JobMaker Credit in another business (one credit per person, not per business). Though the employee will still be eligible if they meet all the other criteria and are working for another business, as long as that business is not receiving the JobMaker Credit for that employee.
  • Not be the subject of other Commonwealth Wage Subsidies

Changes to Headcount over time

The Baseline Headcount – the number of employees the business had at 30 September 2020, is used to determine how many NEW jobs have been created.

In the circumstance where the business headcount changes, the amount of positions above the Baseline Headcount are all eligible for the JobMaker Credit (as long as the employee is also eligible).

As an example;

  • XYZ Fuel had 8 staff on 30 September 2020. That is their Baseline Headcount
  • On 20 October 2020 the business hired 2 new staff into JobMaker roles
  • On 23 December 2020 one of the staff quit
  • On 24 December 2020 the business hired a JobMaker replacement for the staff member that quit

In this example where the business creates 2 new jobs and is claiming the JobMaker Credit for both of those jobs, and one of the employees leaves the business, the business may employ another eligible employee and continue to receive the Credit.

This is because the Baseline Headcount in the business was X on 30 September 2020 and then was X+2 when the 2 new jobs were created. When the employee left it became X+1 so there is still the capacity for 1 position to be claimed in Credit, as it is still a job that is NEW when compared to the status of the business at the test date of 30 September 2020.

There are requirements on the business to report to the ATO the changes that have occurred and when.

The Baseline Headcount does change it will be adjusted up to ensure that only NEW jobs receive the Credit and only for 12 months after creation.

So if in our example above; as the 2 new jobs were created on 20 October 2020 the NEW Baseline Headcount will be 10, and only NEW jobs created in excess of that number will be eligible for the Credit.

Employment Compliance Concerns

The JobMaker Hiring Credit program is still relatively new, however there are several employment concerns and considerations that are likely to become more important over time.

  • No Form
    • While it is noted that employees are to complete a JobMaker Nomination Form, as at 15/10/2020 such a form has not yet been released.
  • Discrimination?
    • In addition to this issue there is the question of actually communicating the eligibility requirements to the candidates for a role.
    • The JobMaker program was specifically designed to provide businesses with an incentive to create new jobs, jobs that they would not have created without the incentive. So it makes sense that the business would advertise the position as a JobMaker position and make employee eligibility for JobMaker a key criteria of the position, at least in the hiring process.
    • This sensible approach however, throws up serious employment compliance and discrimination concerns. Is it even possible to stipulate age and previous government assistance receipt as a criteria of a role? What about when the Credit ends…if the position is contingent on JobMaker does the position cease to exist? Unions are calling for a guarantee to be made that hours will not be changed for the employee after the program ends.
    • As businesses attempt to navigate these not inconsiderable concerns the Prime Minister has pointed to the other schemes that are based on age, including the Restart Wage subsidy, and has highlighted that there is no certainty other than that businesses need support and Australians need jobs and that this program is designed to support businesses to create jobs for the most vulnerable while we navigate the COVID-19 fall out.
  • Minimum Hours…what about casuals?
    • The JobMaker program requires the employee to have worked an average of 20 hours per week for the quarter being claimed. For permanent staff this is not an issue, however, casual staff are employed and engaged by the hour with no firm commitment to ongoing work and no guaranteed hours. It is not clear if the participation in the JobMaker program, and specifically the minimum hours requirement, could give rise to confusion over employment status.

It is clear that over time as disputes arise and are addressed, more clarity will come, however, in the mean time ACAPMA advises Members to be open and transparent with candidates and employees.

Advertising a JobMaker role

This advice may change, however at this point in time, with the very limited practical guidance available, a best practice approach to job advertising is advised

  • When advertising the job outline that it is a JobMaker position

    This is a newly created role under the JobMaker Program and as such candidates will be expected to demonstrate eligibility with the JobMaker provisions (To see if you are eligible see; https://budget.gov.au/2020-21/content/factsheets/download/jobmaker_hiring_credit_factsheet.pdf)

  • Collect the information required to establish eligibility including; age, support payment status, JobMaker Status

    Please confirm your eligibility for JobMaker
    • Please confirm your age is between 16y and 35y
    • Please confirm that you have been in receipt of one of the following support payments for at least one of the previous 3 months – JobSeeker, Youth Allowance (Other), Parenting Payment
    • Please confirm that you are not the subject of another businesses claim for JobMaker (only one business can claim JobMaker for a role you are working in)
  • Remain open to other candidates. If there is churn in the existing staff numbers, those positions will not be JobMaker positions, they will not count as NEW jobs and as such will not be eligible for the Credit, so it is simply sensible to keep an open call approach to all advertising. In addition to creating a detailed list of motivated local job seekers to call on in the event of an opening, this approach also allows for the possibility that a suitable JobMaker candidate may not present themselves.

    While this role is a JobMaker position, the business encourages applications from persons who may not qualify for JobMaker. Your details will be retained and considered for the other existing job vacancies the business has now and may have in the future

More Information

JobMaker Hiring Credit program is new, and more information is coming regularly.

To view the Government Fact Sheet see; https://budget.gov.au/2020-21/content/factsheets/download/jobmaker_hiring_credit_factsheet.pdf

Here to Help

ACAPMA’s Employment Department is available to assist members via employment@acapma.com.au

HR Highlights are things to consider, implement and watch out for in your business.  They are provided as general advice and you should seek further advice on your particular situation by emailing employment@acapma.com.au to reach one of the ACAPMA Workplace Relations Professionals, its free for members.

Elisha Radwanowski BCom(HRM&IR)
Executive Manager Employment and Training