COVID-19 Business Update – 2 September 2020
Welcome back to our Weekly Digest. We hope you and your family are safe and doing well. Read on for this week’s update.
Victoria, the epicentre of Australia’s second wave of COVID-19 infections, has reported a significant drop in the number of new cases, reaching a near two-month low. However, an uptick late last week has slowed down the proposed reopening of the State. The total lockdown in Melbourne was supposed to end on 13 September but has now been extended by two weeks. Details on how restrictions will be slowly eased were released on Sunday and details can be found here:
Maybe we have to learn to live with the virus, rather than aim for unachievable targets of zero or single figure new daily cases?
Australia’s Q2 GDP Shrinks As COVID-19 Pushes Country Into Recession
Australia suffered its worst economic downturn on record last quarter due to COVID-19.
Data from the Australian Bureau of Statistics showed the country’s $2 trillion economy shrank 7% in the three months to end-June, representing the largest decline in quarterly gross domestic product since 1959.
This comes as Victoria remains in lockdown to prevent the spread of the virus. Also, more than a million people have lost their jobs since March when the country had to shut down entire sectors of the economy, which affected demand and investments.
If your business has been hit by the pandemic, chat to us today so we can help you get a plan to come back strong.
Government Launches Business Continuity Website to Support Businesses Amid COVID-19
The Australian Government has launched the Australian Business Continuity website to support businesses with staff working remotely amid the pandemic.
The site provides free practical tools for remote communications, collaboration, workforce management, and video conferencing, as well as advice on how to best use teleworking services.
JobKeeper 2.0 Bill Passed By Federal Parliament
The JobKeeper Amendment Bill 2020 was passed by Federal Parliament this week. Below are the key changes to the scheme:
Extending the period of operation– The JobKeeper scheme and the provisions that allow employers to temporarily vary the working arrangements (by way of JobKeeper enabling directions or agreements under Part 6-4C of the Fair Work Act 2009) will now end on 28 March 2021 instead of 28 September 2020.
New payment rates– The current JobKeeper subsidy rate for full-time workers of $1,500 a fortnight will drop to $1,200 from 28 September 2020, and then to $1,000 a fortnight from January 2021. Meanwhile, those who worked less than 20 hours per week in the relevant reference period (being the four-week pay period before either 1 March 2020 or 1 July 2020) will receive $750 from 28 September 2020, and then to $650 a fortnight from January 2021.
Legacy Employers– Employers who no longer qualify for JobKeeper after 28 September will be classified as legacy employers, and will have to satisfy a 10% decline in turnover to have access to modified JobKeeper enabling directions.
Decline in Turnover Test Certificate– Employers will need to obtain a 10% decline in turnover test certificate from an eligible financial service provider, including a BAS or Tax agent.
These modified directions include reducing an employee’s ordinary hours to a minimum of 60% of the employee’s ordinary hours as they were at 1 March 2020, but cannot result in the employee working less than two consecutive hours in a day.
A dispute can be brought before the Fair Work Commission about whether an employer holds a 10% decline in turnover certificate for the relevant period, including a dispute about whether a certificate is valid.
Penalty– A penalty of up to $13,320 for individuals and $66,600 for body corporates or employers will be imposed if an employer doesn’t meet the 10% decline in turnover test and knowingly or recklessly tries to use the provisions or fails to notify employees that a JobKeeper enabling direction or agreement is not continuing due to not having met the requirements.
JobKeeper Turnover Test Requirements
From the 28th of September 2020:
- businesses looking to claim the JobKeeper payment will be required to demonstrate that they experienced a decline in turnover using actual GST turnover, rather than projected GST turnover.
- businesses will be required to reassess their eligibility with reference to their actual GST turnover in the September 2020 quarter to be eligible for the JobKeeper Payment from 28 September 2020 to 3 January 2021 (the first extension period).
From 4th January 2021:
- businesses will need to further reassess their turnover to be eligible for the JobKeeper Payment. They will need to demonstrate that they suffered a decline with reference to their actual GST turnover in the December 2020 quarter to be eligible for the JobKeeper payment from 4 January 2021 to 28 March 2021 (the second extension period).
The required decline in GST turnover percentages will remain the same:
- 30% for an aggregated turnover of $1 billion or less
- 50% for an aggregated turnover of more than $1 billion
- 15% for ACNC-registered charities other than universities and schools.
Shop Local to Kickstart Economic Recovery
Local small businesses are a vital part of our economy and the communities they represent. While the government is trying its best to protect the economy, there are many ways people can do their part and support local small businesses. Here are ways you can help small businesses stay afloat during the COVID-19 crisis.
- Purchase gift cards from your local stores.
- Shop online, but keep it local.
- Order takeaway food and drinks from your local restaurants.
- Be a little more generous than usual when giving tips.
- Leave positive reviews online and promote them on social media.
- Postpone instead of cancelling.
- Join online classes if local businesses offer this option to follow social restrictions.
The coronavirus is one of the greatest challenges of our times. If you own a small business and are struggling, please get in touch.
Government-backed COVID-19 Loans Extended
The government is extending its small business COVID-19 loans scheme until June 2021. If you need help to access these loans or you want to find out if you are eligible, don’t hesitate to drop us a message.
How to Know Which New Product Ideas to Pursue
Last week, we talked about ways to come up with fresh ideas to bring in more money into your business or identify a profitable niche for a new business.
Now that you have a list of new product ideas, the next logical step is to determine which of these are worth pursuing. Check out this Forbes article that discusses ways to determine if your customers want your new product and how to make sure you’re investing your time wisely.
If you need guidance in boosting your profitability, don’t hesitate to get in touch with us for expert business advice tailored specifically to your business
Taking Time Off From Work During the Pandemic
With the extended periods of lockdown and working from home, days become indistinguishable from one another and the line between work and life starts to blur. As people tend to work longer days, not to mention the fact that we are still in the middle of a pandemic, managing stress levels has become more important than ever.
So what does taking some time off from work during a pandemic look like? This Forbes article shared some steps to take a work-free vacation, including:
- Truly disconnect from work by setting an out of office message on your email and turning off notifications that will tempt you to work.
- Prepare for your time off by figuring out what must be done ahead of time and which ones can wait until you get back.
- Sometimes, you can only disconnect from work 90% of the time. So establish boundaries by setting a specific time frame you’ll allow yourself to address urgent issues and check in on critical projects during your vacation.
- If you live in an area with strict social restrictions, you’ll need to get creative on how you’ll spend your time off. Staying at home doesn’t mean boring- spend quality time with your family, try out new activities, or meet with your friends virtually.
Regardless of how you spend your vacation, the important thing is to use this time to rest, relax, and recharge your body and mind. Do this, and you’ll get back to work feeling refreshed.
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