How JobKeeper’s staff could be fired anyway

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Australians receiving JobKeeper could be sacked anyway when government payments end. (Image: Getty)

About 3.5 million Australians receive the JobKeeper payment from employers who have done “the right thing” by keeping them on the payroll rather than firing them.

And now the federal government has pledged to pay JobKeeper for an additional six months, until March of next year.

But companies reeling from the coronavirus recession are urged to carefully consider whether retaining staff on JobKeeper will eventually push them into extinction.

The Small Business Association of Australia has confirmed Yahoo finance that employees on JobKeeper continue to accumulate vacation and pension rights.

This means companies could owe an entire year of vacation and employee benefits on their books as little revenue is generated during the virus-induced downturn.

That’s a lot of money that could bankrupt many small and medium-sized businesses, especially if they’re still struggling when JobKeeper’s payments end in March.

“Unfortunately, both groups can be the losers – the worker and the small business owner,” said Anne Nalder, head of the SBAA.

“I know many small business owners would rather keep their staff and continue with their small businesses. [But] Unfortunately, many small businesses will collapse. “

The original JobKeeper, running until September, retrospectively pays companies $ 1,500 bi-weekly to pass on to each employee. The extended program announced this week sees that amount decrease until March.

Nalder said Yahoo finance that this week’s announcement of government-backed 50 percent business loans would help preserve jobs somewhat – but the appearance of the economy in March is highly uncertain.

“It is up to the business owner who will have to decide whether his business is viable and can emerge from the current crisis,” she said.

“If their business is a viable business and they can get by and rebuild themselves, they may decide to borrow – but again, they must be aware of the long-term viability of the loan and the consequences. of the closure of his business, by one or the other of bankruptcy.

Council of Small Business Organizations Australia CEO Peter Strong agreed with Nalder’s view of the risks of keeping “zombie workers” through JobKeeper.

“Numerous [businesses] accumulate a debt that they cannot pay because they do not have the income that comes in, ”he said Nine.

He suggested some companies might consider closing and then coming back when conditions are better, rather than trying to fight while keeping staff.

“Don’t put your business at risk because that means everyone loses their jobs and you lose your home.”

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