On 14 August 2020, the Government registered rules and provided more details about a previous JobKeeper announcement made on 7 August 2020 to extend the JobKeeper employment test date (and subsequent employee eligibility conditions) to 1 July 2020 for JobKeeper fortnights beginning on, or after 3 August 2020.
These changes mean potentially more employees can qualify for JobKeeper and include:
These new rules do not apply to any entitlements payable for JobKeeper fortnights ending on or before 2 August 2020. To qualify in this period, employees had to be employed at 1 March 2020, satisfy certain age conditions as at 1 March 2020 and must not have been nominated as an eligible employee, business participant or religious practitioner of another entity before (i.e. for the period up to 2 August 2020, it was not possible to qualify for JobKeeper if an individual was re-employed).
Employees that satisfied the 1 March 2020 employee testing requirement on or before 2 August 2020 do not need to re-test their eligibility with reference to the new 1 July 2020 employee testing date (i.e. once in JobKeeper, always in JobKeeper).
However, there are three scenarios where businesses may need to test eligibility for JobKeeper from 3 August 2020.
Relevant to employees employed on 1 March 2020 but who were not eligible for JobKeeper because they:
In the four months from 1 March 2020 to 1 July 2020, circumstances may have changed that employees may have met the relevant conditions (e.g. long term casual employees, JobKeeper age requirements or residency requirements) by 1 July 2020.
Relevant for businesses that employed new workers after 1 March 2020 and these workers are still employed as at 1 July 2020 with the current business, even if such workers were previously employed or were an eligible business participant in previous businesses prior to 1 July 2020.
Important note: Because the application of the re-employment rule is different from 3 August 2020, where a new employee resigns from a former employer who was eligible for JobKeeper payments and joins a new employer before 1 July 2020 (and is still employed at 1 July 2020 by only the new employer), such an employee will not qualify for JobKeeper for fortnights ending on or before 2 August 2020 but will qualify for JobKeeper for fortnights starting from 3 August 2020 in respect of the new employment.
Relevant for employers who qualified for JobKeeper payments under the 1 March 2020 employment test rules, but after 1 March 2020, the employee ceased to be employed but is then subsequently re-hired by the same employer before 1 July 2020.
To qualify for JobKeeper in this scenario, no other entity must have qualified for JobKeeper payments in respect of that individual for any JobKeeper fortnight in the interim period. Such an employee will qualify as a 1 March employee
For the fortnights beginning 3 August 2020 and 17 August 2020, businesses have until 31 August 2020, instead of before the end of the fortnight, to satisfy the wage conditions in respect of newly eligible employees. That is to pay the wages of newly eligible employees before the ATO pays the $1,500 JobKeeper allowance to the employer.
Businesses with employees that qualify for JobKeeper after 3 August 2020 (i.e. subject to 1 July 2020 rules) must give those employees a new nomination form which needs to be filled in and returned to the business by 21 August 2020. This does not apply to employees who have previously been provided a nomination notice or those who the business reasonably believes would not satisfy the 1 July 2020 requirements.
Businesses must then give a notice to the ATO of information about the individual and their nomination and ensure any top-up payments for new employees in respect of the 3 August and 17 August JobKeeper fortnights have been met by 31 August 2020.
With these new rules in place, it will be possible for more people than ever to qualify for JobKeeper. However, we expect to see significant audit activity from the ATO in the coming months to determine whether businesses that have claimed the JobKeeper payment were in fact eligible to qualify.
If you have individuals that are eligible for JobKeeper for the first time since 3 August 2020 pursuant to these new 1 July 2020 rules, please get in touch with your Crowe adviser for further advice, or contact the Tax Advisory team for more information on the new rules and their application to your business.
 Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No. 7) 2020