Prime Minister Scott Morrison has doubled down on the government’s warning for small businesses to play by the rules when it comes to its JobKeeper wage subsidy scheme, suggesting that those that try to claim some of the cash for themselves can expect the full force of the law.
In his press conference yesterday, Morrison said any attempt from an eligible employer to skim some of the JobKeeper subsidy for themselves would be “really appalling behaviour”.
Even as confusion still reigns about who may be eligible for the payments and who may not, there have already been reports of employers behaving badly — or planning on it at least.
Morrison called on anyone witnessing this behaviour from employers to report it both to the police and the ATO.
“That is disgraceful and it’s illegal, and they should be reported to the police and the ATO,” Morrison said.
Centre Alliance MP Rebekha Sharkie, the federal member for Mayo, South Australia, tweeted her concerns following a report of an employers offering to pay just over half of the JobKeeper wage available.
When the employee refused to hand over part of the payment she’s entitled to, the employer supposedly said it would not apply for the JobKeeper subsidy at all.
Sharkie called for a hotline “for employees pressured to commit such fraud”.
Secretary of the Australian Council of Trade Unions Sally McManus has also weighed in, simply clarifying that this kind of activity is “not legal”.
— Sally McManus (@sallymcmanus) April 15, 2020
An employee let go 3 weeks ago was contacted by former employer today offering #JobKeeper but only if she gives them $600 of her payment. She refused, employer no longer willing to file paperwork. We need a hotline for employees pressured to commit such fraud. #auspol
— Rebekha Sharkie MP ???? (@MakeMayoMatter) April 15, 2020
The JobKeeper package is intended to allow employers to keep their staff on the books, while alleviating the financial burden of doing so. Rather than providing direct financial support to the business, it’s intended to mitigate payroll expenditure.
It will provide a wage subsidy of $1,500 per fortnight for each eligible employee, back paid to March 30. But, all of that money must be passed onto the employee.
When the JobKeeper bill was passed last week, it included the threat of legal action for employers that try to keep some of the cash for themselves.
“An entity that does not comply with its obligations in relation to the JobKeeper payment is also potentially liable for a wider range of significant administrative and criminal sanctions under the tax law and general criminal law,” the latest fact sheet says.
“These penalties will not affect entities that act honestly and with reasonable care.
“However, entities that seek to abuse the scheme, especially those that seek to engage in fraud, will face penalties commensurate with the seriousness of their conduct.”
The potential penalties laid out in the fact sheet range from fines based on the amount of money involved, to up to 10 years in prison, for conspiracy to defraud.
The legislation itself suggests employers that fail to pass on the payments to workers could face fines and/or civic penalties of up to $126,000 if they “knowingly misuse” the range of new powers granted to them.
“Serious penalties will apply to employers who misuse the provisions,” Treasurer Josh Frydenberg warned last week.