Small business Ombudsman calls on Federal Government to change flaw in JobKeeper system

The Australian Small Business and Family Enterprise Ombudsman Kate Carnell is calling on the Federal Government to change JobKeeper rules to allow struggling small businesses to replace staff.

Kate Carnell says as the economy recovers from the COVID crisis and more jobs become available, small businesses that are still trying to get back on their feet are losing their staff and cannot hire replacement employees under JobKeeper rules.

“While some small businesses are doing well, there are a significant proportion of small businesses that are still doing it tough,” she says.

“JobKeeper was reduced again on 4 January, 2021, and with some eligible businesses unable to afford to top up wages, they are having to reduce the hours of their staff.

“It means staff are resigning to go to jobs offering more hours and pay.

“While the JobKeeper program was originally designed to allow businesses to keep their existing staff, the economic recovery is presenting new challenges for some small businesses.

“Under JobKeeper rules, eligible businesses cannot replace their staff with a new staff member and still attract the government payment.

“Unfortunately this rule has the unintended consequence of increasing the divide between the haves and have nots in the small business sector.

“From a struggling small business perspective, this JobKeeper rule makes a bad situation worse because they are losing their staff and cannot afford to replace them.

“It’s imperative that the government changes JobKeeper so that small businesses that have been hit hardest by the COVID crisis can replace their staff to help them get their businesses back up-and-running.

“Our national economic recovery will be driven by jobs growth and that’s why it’s critical to support small business employers during this difficult time to allow them to survive, grow and hire in the future.”