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JobMaker Hiring Credit Scheme

In our Federal Budget bulletin published in October, we gave a brief overview of the JobMaker Hiring Credit program. The program effectively starts from 7 October but the Treasurer has released the Rules of the scheme and the Taxation Office have published detailed guidance on their website.

The key aim of the program is to get young jobseekers back into the labour force by allocating subsidies to eligible employers.  Like the JobKeeper program, there are certain conditions to be satisfied in respect of employees and employers.  These criteria are different to JobKeeper so if you weren’t eligible for JobKeeper, you may be eligible for JobMaker, and vice versa.  Through the JobMaker Hiring Credit program, eligible employers may receive payments of up to:

  • $200 a week – for each eligible additional employee aged 16 to 29 years old inclusive.
  • $100 a week – for each eligible additional employee aged 30 to 35 years old inclusive.

Registrations for the program have opened this week and the first claim period will open on 1 February so the time to start taking action is now and in early January.  We have outlined the basics of the program below.

Employer Eligibility for JobMaker

Employers are eligible if they:

  • operate a business in Australia, or are a
    • not-for-profit organisation that operates principally in Australia
    • endorsed deductible gift recipient (DGR)
  • have an Australian Business Number (ABN)
  • are registered for pay as you go (PAYG) withholding
  • report through Single Touch Payroll (STP)
  • are up-to-date with income tax and GST lodgement obligations for the last 2 years
  • have not claimed a JobKeeper payment for a fortnight that started during the JobMaker period
  • meet the job creation requirements
  • are not specifically ruled ineligible (including government entities, those subject to the Major Bank Levy and entities that have entered bankruptcy or liquidation)

Employee Eligibility for JobMaker

Employees are eligible if they:

  • have not given an employee notice to another employer which is still in effect
  • are between 16 and 35 years old (inclusive) when they started employment
  • received income support payments, including the JobSeeker Payment, Youth Allowance (other than on the basis that the individual was undertaking full-time study or was a new apprentice) or Parenting Payment
    •  for at least 28 consecutive days (or 2 fortnights)
    •  within the 84 days (or 6 fortnights) before being hired.
  • start employment with the employer between 7 October 2020 and 6 October 2021
  • are hired as a permanent or casual employee, or on a fixed-term basis
  • have worked, or have been paid, for at least 20 hours per week you employed them, over the JobMaker period
  • have given you a notice declaring they meet the employee eligibility criteria.

Job creation criteria

To meet the “job creation” criteria, employers must have an increase in both:

  • total employee headcount from 30 September 2020, and
  • payroll for the JobMaker period, compared to the 3 months up to 6 October 2020.

There are integrity and anti-avoidance measures within the Rules to ensure that an employer does not reduce the hours of or terminate an existing employee to make room for new employees, and also to ensure that related persons and contractors are excluded.

The Process

The basic process is to:

  1. Register for the program (this is open now)
  2. Nominate employees through STP – this will be similar to JobKeeper requirements
  3. Claim every 3 months from 1 February 2021 through the same mechanisms that existed for JobKeeper

The rules are complex and making accurate claims will depend on being able to correctly assess the eligibility criteria – we strongly recommend contacting us for assistance.  The information above is a broad overview of the basics of the rules but in the case of the JobMaker program, the devil is definitely in the details!