The government has passed the $130 billion JobKeepers legislation, which will see thousands of small businesses receive the JobKeeper payment from early May.
The flat payment of $1,500 per fortnight per eligible employee will be delivered by the Australian Taxation Office (ATO), assisting small businesses pay their staff that continue to work as well as staff that have been stood down since 1 March 2020.
Small businesses, including sole traders, which have an annual turnover of less than $1 billion and estimate their turnover has fallen or will fall by 30 per cent or more are eligible for the subsidy.
“The JobKeeper payment is critical to the survival of small businesses that have been impacted by the COVID-19 crisis,” says the Australian Small Business and Family Ombudsman, Kate Carnell.
“Crucially it will allow small businesses to continue operating and paying their staff. It will also keep small businesses connected to their staff, who have been stood down, so they can re-engage their team when the time comes to ramp up.
“There has been a lot of confusion out there about eligibility for JobKeeper, but the intent of this policy is to be inclusive of small and micro-businesses under financial strain in this difficult time. That includes, sole traders, partnerships, contractors, freelancers and trusts.”
Take care of your health
The My Business Health portal has been redesigned to walk small business owners and sole traders through the practical steps they need to take to keep their businesses afloat.
“Small businesses are under enormous pressure right now, with many forced to close their doors and others unsure how they will survive the coming months,” Carnell says.
“In addition to providing small businesses and sole traders with a very simple guide to what assistance is available to them, My Business Health also links to Beyond Blue’s new dedicated coronavirus mental health support service.”
Minister for Employment, Skills, Small and Family Business, Senator the Hon Michaelia Cash, says the Morrison Government was committed to ensuring support to small businesses during this challenging time.
“There’s no question Australians are doing it tough right now, and on top of the financial assistance available to small businesses, we want to make sure the small business operators have the necessary mental health support as well,” Cash says.
Rent relief for small business
The mandatory Commercial Tenancy Code released today by the Federal Government paves the way for small businesses to negotiate some rent relief with their landlords.
The code, to be legislated and regulated in each state and territory, will be overseen through a binding mediation process.
Small businesses are eligible to negotiate under the code if:
· They are experiencing financial distress
· They are eligible to receive support from the JobKeeper program
· They have a turnover of $50 million or less
“The Code is based on principles of good faith and will be a critical guide for small businesses and landlords at the negotiating table during this COVID-19 crisis,” Carnell says.
“There’s give and take here, so small businesses can’t just stop paying rent and equally landlords cannot evict or terminate the lease.
“Tenants must honour their lease agreement and landlords are prohibited from drawing on a tenant’s security.
“Importantly, eligible small businesses that have seen a reduction in trade, will be able to negotiate a proportional rent reduction with their landlord. This can be achieved through a combination of waivers and deferrals of rent.
“Australian banks have already indicated they will support landlords that support their tenants and I would urge international banks to take the same approach.
“There are no easy solutions to this problem, but if all parties involved can come to these negotiations in the spirit of co-operation, there’s a good chance of reaching an agreement,” she concludes.
