Proposed JobKeeper change could slash $300 a week from workers

A new proposal to drastically change JobKeeper could see workers receive $300 less per week as bosses look to reduce workers’ hours.

Workers could have their pay slashed by more than $300 a week under new JobKeeper laws that will allow some bosses that no longer qualify for the wage subsidy to reduce workers’ hours.

Previously, workers’ wages could not be reduced below the “floor” of the $1500 a fortnight wage subsidy but that’s about to change under proposed changes.

Introducing the new laws today Treasurer Josh Frydenberg said the changes were needed to support struggling businesses.

Under the new laws, the $1500 JobKeeper payments will be extended until March but at a reduced rate of $1200 a fortnight for eligible companies.

“The measures will provide continued workplace flexibility at a time businesses are still in distress,’’ Mr Frydenberg said.

But Labor’s industrial relations spokesman Tony Burke has raised concerns that the industrial relations “flexibility” clauses in the legislation for struggling companies will allow some companies to slash the wages of workers even if they no longer qualify.

Under the changes, companies that previously qualified for JobKeeper but no longer will secure the wage subsidy will still be able to reduce workers wages if their turnover is down by 10 per cent.

For example, retail workers who earn $813 a week full-time could be suddenly told they are only needed part-time.

“A full-time retail worker, under what’s before Parliament right now, could lose $325 a week. Obviously falling well below the current JobKeeper rate,’’ Mr Burke told Parliament.

“And even under the new JobKeeper rate falling $100 a week short of it.

Workers could have $300 a week slashed from their pay under proposed changes to JobKeeper.

“This creates a situation where a worker at the time that the business they work for is doing better will see their pay cut.

“How can you justify that Parliament has given permission for their take home pay to go down?”

Mr Burke said the Morrison Government had backed down on moves to extend that flexibility to any company that had previously qualified JobKeeper a move that would have covered over 3 million workers.

“They have backed down on that and we welcome that,’’ Mr Burke said.

Instead, the Morrison Government will extend the flexibility to any company that no longer qualifies for JobKeeper but is still recording a 10 per cent downturn in revenues.

“That is a better position than what the government had a week ago. But it’s still problematic.”

Treasurer Josh Frydenberg will also hold extraordinary powers to set the rate and eligibility of JobKeeper payments with the stroke of a pen under the rules of the extended scheme.

The amended legislation does not stipulate the rate is reducing $1,500 to $1,200 a fortnight.

Those changes will be introduced after the amended legislation passes the Parliament by ‘rules’ which can be changed by the Morrison Government at any time.

That means the Treasurer has the power to increase the JobKeeper rate if the crisis worsens or decrease the rate without the requirement of recalling Parliament.

The ability to change the rate at will was also a feature of the previous legislation, although the Morrison Government ultimately chose to leave the rate unchanged for the duration of the original program.

Labor’s treasury spokesman Jim Chalmers said the powers meant the “ball was in the Treasurer’s court” when it came to setting the rate.

“It’s important to remember that this JobKeeper legislation does not specify the rate of JobKeeper and it does not say who will get it,’’ Dr Chalmers said.

“It is up to Josh Frydenberg entirely and alone to determine what the rate of JobKeeper is and who is eligible for JobKeeper. We have two main concerns about how he’s going about that task of setting the rate and eligibility.

“This is his third crack at this. Too many people have been left behind and left out in the earlier iterations. This is his opportunity to fix those errors that he’s made.”

Originally published as Proposed JobKeeper change could slash $300 a week from workers