The Senate economics legislation committee is taking a closer look at the Economic Recovery Package (JobMaker Hiring Credit) Amendment Bill 2020, due to give life to the government’s $4 billion wage scheme, with a report expected on 6 November.
Under the scheme, eligible employers would have access to $200 a week for each additional eligible employee they hire aged 16 to 29 years old, and $100 a week for each additional eligible employee aged 30 to 35 years old.
The actual hiring credit would be claimed quarterly in arrears by the employer from the Australian Taxation Office (ATO) from 1 February 2021.
Expected to give businesses the incentives to take on additional young jobseekers, the scheme has faced some backlash, with critics arguing it discourages businesses from hiring people over 35.
The scheme does, however, have strict criteria, requiring an employee to work a minimum 20 hours per week, and to have been the recipient of the JobSeeker payment, Youth Allowance (other) or Parenting Payment for at least one month out of the three months prior to when they are hired.
Businesses, too, need to meet certain criteria such as hold an ABN, be up to date with their tax lodgement obligations, be registered for PAYG withholding, and report through Single Touch Payroll.
Most importantly, however, employers are not able to claim JobKeeper at the same time.
The additionality criteria also require that there is an increase in the business’s total employee headcount from the reference date of 30 September 2020, as well as in the payroll of the business for the reporting period, as compared with the three months to 30 September 2020.
The amount of the hiring credit claim, however, cannot exceed the amount of the increase in payroll for the reporting period.
But despite the strict eligibility, Treasurer Frydenberg believes the scheme will help support 450,000 jobs.
“Having a job means more than earning an income. It means economic security. It means independence. It means opportunity,” Mr Frydenberg said at the budget’s reveal.