Australian workers told JobSeeker payments may make them ineligible for coronavirus welfare support

Australian workers stood down during the coronavirus pandemic have been warned the government’s new JobKeeper package may leave them ineligible for welfare support payments.

On Monday Prime Minister Scott Morrison announced an unprecedented plan to pay struggling businesses $1,500 per employee per fortnight to subside their wages.

The $130billion scheme will pay the wages of six million Australians for the next six months, with employers legally obligated to pass each payment on to their workers.

However, the third stimulus package may clash with the coronavirus supplement set up to help Australians laid off during the crisis – a $550 payment which will be made on top of eligible welfare benefits from April 27.

In a notice issued following the announcement of the $130billion wage subsidy, the Treasury said those receiving income from the scheme must report the payments to Services Australia. 

The fact sheet used the example of a single worker, ‘Phoebe’, with no children who would be eligible to receive $1,124.50 before tax per fortnight under the JobKeeper scheme. 

‘Phoebe’s employer has decided to apply for the JobKeeper Payment for all its eligible employees for up to six months,’ the example said.

‘This would entitle Phoebe to $1,500 per fortnight before tax. Phoebe’s employer is required to advise her that she has been nominated as an eligible employee to receive the payment.

‘If Phoebe elects to receive income support though Services Australia, she will need to report her income from the JobKeeper Payment to Services Australia.’

The example said as a result the worker may no longer be eligible for welfare support, which includes the $550 payments. 

Prime Minister Scott Morrison announces the government’s $130billion wage subsidy package at a press conference at Parliament House in Canberra on Monday

Australians queue outside a Brisbane Centrelink last week. The JobKeeper wage subsidy needs to be reported to Services Australia, and may make the employee ineligible for welfare

The flat-rate JobKeeper payment is about 70 per cent of the median wage and is roughly equal to the median wage in the industries most affected by the pandemic, such as hospitality and tourism.   

The payment will go to full-time workers, part-time workers and casual workers who have been employed by a company for 12 months, regardless of how many shifts they worked.

The policy will apply to workers who have already been stood down, provided they were on their employer’s books on March 1.

The scheme is part of the government’s third round of measures to shore up the economy as officials urge people to stay at home to slow the spread of coronavirus. 

In total, the the three relief packages amount to more than $320billion, or 16.4 per cent of GDP.

‘We want to keep the economy running through this crisis, it may run in idle for some time, but it must run,’ Mr Morrison said.

‘We will give millions of eligible businesses and their workers a lifeline to not only get through this crisis, but bounce back together on the other side,’ he added.

The payments via the ATO will be made to businesses, sole traders and not-for-profit organisations whose revenues decrease by 30 per cent or more due to the coronavirus fallout.

Any business that turns over more than $1 billion will have to prove revenues are down 50 per cent to be eligible.