The Queensland Government has passed legislation to establish a new portable long service leave scheme available for community services workers. The scheme seeks to reward workers for service to the industry by ensuring they receive long service leave benefits, even if they change employers.

Under the scheme, employers in the community services industry will be required to register their business or organisation with QLeave.
The scheme starts on 1 January 2021, so community services organisations must start preparing for the upcoming changes now.

QLeave is the statutory authority administering existing portable long service leave schemes in Queensland and will be the authority for the community services industry portable long service leave scheme.

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How does it work?

As an employer, you must register with QLeave and submit quarterly employer returns. These returns detail the total of ordinary wages paid to your workers during the return period.

Qleave will record the time worked and wages received by each worker. This results in service credits accruing towards a worker’s long service leave entitlement.
Workers can check their service record online at any time. If any service is missing, workers should contact their employer/s.

You’re an employer in the Queensland community services industry if:

• your organisation is established to or has a purpose to provide community services
• you are an individual who is self-employed and provides community services (registration optional)
• you provide labour-hire services that supply an organisation with an individual to perform community services work
• you are an entity prescribed by regulation to be an employer (An employer does not include the Commonwealth, State or Local Government)

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How much does it cost?

There is no fee to register with QLeave. However, registered employers pay a levy based on the ordinary wages of their workers. The levy collected is invested, and the accumulated funds then pay the workers’ long service leave claims.

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Who is eligible?

Workers in Queensland’s community services industry who:

• perform community services work, or
• support the provision of community services (for example, administrative and/or executive staff).

This includes workers who:

• are engaged as a full-time, part-time or casual employee
• are engaged under a contract for service, including labour hire workers
• operate as a sole trader
• work for both for-profit and not-for-profit organisations.

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Community service work covered by the scheme

From the Community Services Industry Act 2020:
The “community services industry” is the industry in which entities provide community services in Queensland.  Types of “community services” as prescribed by the Act are:

• Aboriginal and Torres Strait Islander community services
• Accommodation support services
• Alcohol and other drug services
• Child safety and support services
• Community development services
• Community education services
• Community legal services
• Counselling services
• Disability emergency response services
• Disability support services
• Employment services
• Family and domestic violence services
• Family daycare services
• Financial counselling services
• Foster care and out-of-home care services
• Home and community care services
• Homelessness support services
• Lesbian, gay, bisexual, transgender and intersex services
• Mental health services
• Migrant and multicultural support services
• Offenders transitioning services
• Respite services
• Seniors community support services
• Social housing services
• Violence prevention services
• Women’s services
• Youth justice services
• Youth support services

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Who is not eligible?

Some community services workers are not eligible to join QLeave.

These include:

• federal, state and local government workers
• workers engaged to perform work unrelated to the purpose of providing community service
• workers in standalone childcare and early childhood education centres, kindergartens and school-based childcare services
• workers employed in aged care, in a nursing home or retirement village delivered by a standalone aged care provider or service.

If you engage only workers that are not eligible to join QLeave, you’re not required to register with the scheme.

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What are the steps from here?

1.     Register
If you’re an employer in the community services industry in Queensland and engage one or more eligible workers to perform community services work, you must register with QLeave. Registrations are now open.

Please note: Registration is compulsory, and penalties may be imposed if you fail to register. You must register within 7 days of becoming an employer in the community services industry.

2.     Inform QLeave of your workers’ service each quarter
It’s a legislative requirement that employers give details to QLeave about their workers’ service each quarter. You can do this when you complete your quarterly an employer return.

You must provide details to QLeave about your workers’ service and wages on a quarterly basis. You can do this by completing an Employer Return.

The time worked and wages received are recorded against your worker’s QLeave membership and counts towards their long service leave benefit. The return is a list of all eligible workers recorded by Qleave as being employed by you or your company.

If you have additional workers that are eligible and don’t appear on the list, you’ll need to add them.

Due dates

Due dates for submitting Employer Returns and paying the levy are:

• 14 January
• 14 April
• 14 July
• 14 October

Avoid penalties

It’s a legislative requirement to submit the Employer Return by the due date. There are penalties should returns not be lodged by the due date.
Failure to lodge the return may result in QLeave commencing prosecution, without further notice to you. Prosecution may result in a conviction and fine for each worker not included on your return. You may also have to compensate QLeave for costs incurred due to legal action.

3.     Pay a quarterly levy based on your workers’ ordinary wages
You’re required to pay a levy each quarter based on the ordinary wages of your workers as reported on your employer return. The current levy rate is 1.35% of workers’ ordinary wages.

Payment options include credit card, BPay and EFT.

4.     Books and records
QLeave conducts random inspections of registered employers’ books and records to check compliance with their obligations.

QLeave Compliance and Liaison Officers are authorised to perform inspections of employers’ books and records, to check compliance with their obligations.

You must keep books and records for six years after the last entry was made in the book or record which include:

• worker’s full name, address and date of birth
• worker’s QLeave membership number
• type of work performed
• periods, and proportions of the periods, during which the worker performed the eligible work
• any award details for each worker (where applicable)
• Time and wage records, such as timesheets, that show the hours of work should be maintained for all workers, including working directors and labour-only subcontractors. These will need to be produced for a books and records inspection.

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Long service leave claims

Workers, who are employed by the same employer for ten or more continuous years, may be entitled to long service leave paid by the employer under the Industrial Relations Act 2016.

If you pay long service leave to a worker under the Industrial Relations Act 2016, you may claim reimbursement from QLeave for some, or all, of the payment made to the worker. You will only be able to claim reimbursement for service that is recorded with QLeave (from 1 January 2021).

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Paying long service leave under the Industrial Relations Act 2016

Workers, who are employed by the same employer for ten or more continuous years, may be entitled to long service leave paid by the employer under the Industrial Relations Act 2016. The portable long service leave scheme doesn’t replace an employer’s obligation to pay long service leave to their worker/s.

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Claim reimbursement for long service leave paid to a worker

QLeave may reimburse you for some, or all, of the payment you make to the worker. You must lodge your claim for reimbursement to QLeave within three months of the day you paid long service leave to the worker. The payment is calculated in accordance with the legislation and is based on the wages declared for the individual worker.

To ensure you receive the maximum amount reimbursed, you need to include an Employer Return detailing service in the most recent quarter and the levy payment for the worker up to the date of leave, especially if the worker is retiring or resigning from the company.

Employers can apply for reimbursement by completing an Employer Claim form.

For QLeave to process an employer reimbursement, they require proof that you made the long service leave payment to the worker. A copy of the pay-slip indicating long service leave paid, or an extract from the payroll system confirming payment should be attached to the claim form.

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How Can MGI Help You

If you are a Community Organisation that may be impacted and need assistance understanding the potential financial impact, please contact us for a free consultation.

(This blog is an update to the previously posted blog on this scheme 12 July 2020)

The alternative decline in turnover test for JobKeeper fortnights from 28 September onwards has been released by the ATO.

The new alternative tests are in line with the original covering the 7 circumstances outside the usual business operation that resulted in your 2019 relevant comparison period not being appropriate for applying the basic decline in turnover test.

This includes the following:

1. Business that started after the comparison period
2. Business acquisition or disposal that changed the entity’s turnover
3. Business restructure that changed the entity’s turnover
4. Business that has had a substantial increase in turnover
5. Business affected by drought or natural disaster
6. Business that has an irregular turnover
7. Sole trader or small partnership with sickness, injury or leave

Below are some of the key changes that you should take into consideration when applying the appropriate tests

• The alternative test is now based on the actual GST turnover rather than projected GST turnover, which is in line with the basic decline in turnover test for the JobKeeper extension from 28 September.
• Turnover comparison method
  • For entities that are registered for GST, the method used for calculating the turnover will need to be in line with their GST registration (i.e. cash or accruals)
  • For entities that are not registered for GST, the entity can elect the method used for calculating the turnover; however, a consistent approach will need to be taken.
• Entities that experienced a substantial increase in their current GST turnover will now be able to choose between using the period immediately before the turnover test period or before 1 March 2020.
• Similarly, with the irregular turnover test, a choice is now available using the period immediately before the applicable turnover test period or before 1 March 2020.
• The new alternative test removes the requirement for entities with multiple acquisitions, disposals and restructures to use the period after the last of the sequential transactions.  The changes allow an entity that has had multiple acquisitions, disposals or a sequence of restructure transactions at or after the start of the relevant comparison period but before the applicable turnover test period to apply these tests to each acquisition, disposal or restructure separately.
• The test for sole traders or partnerships affected by not working for all or part of that period due to sickness, injury or leave can apply the current GST turnover for the month immediately before the month in which the sole trader or partner did not work, rather than the turnover for the month immediately after the month in which they returned to work.

As with the previous alternative test or the basic decline in turnover tests, you will need to maintain sufficient and appropriate documentation on how the tests have been applied in case of an ATO review.

Please feel free to contact the team at MGI South Queensland if you wish you to discuss the application of the alternative test to your circumstances.

The Government has announced the extension of the JobKeeper Payment until 28 March 2021 and is targeting support to those businesses that continue to be significantly impacted by the Coronavirus.

From 28 September 2020, eligibility for the JobKeeper Payment will be based on actual turnover in the relevant periods and the payment will be stepped down and paid at two rates.

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How can you be Eligible?

To be eligible for JobKeeper Payments under the extension, businesses and not-for-profits will still need to demonstrate that they have experienced a decline in turnover of:

• 50 per cent for those with an aggregated turnover of more than $1 billion;
• 30 per cent for those with an aggregated turnover of $1 billion or less; or
• 15 per cent for Australian Charities and Not for profits Commission-registered charities (excluding schools and universities).

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Periods of Turnover Testing

In order to be eligible for the JobKeeper Payment from 28 September 2020, businesses will have to meet a further decline in turnover test for each of the two periods of extension, as well as meeting the other existing eligibility requirements for the JobKeeper Payment.

To be eligible for Jobkeeper payment from 28 September 2020 to 3 January 2021

Businesses will need to demonstrate that their actual GST turnover has fallen in the September quarter 2020 (July, August, September) relative to a comparable period (generally the corresponding quarter in 2019).

To be eligible for the second JobKeeper Payment extension period of 4 January 2021 to 28 March 2021

Businesses and not-for-profits will need to demonstrate that their actual GST turnover has fallen in the December quarter 2020 (October, November, December) relative to a comparable period (generally the corresponding quarters in 2019)

The Commissioner of Taxation will have the discretion to set out alternative tests that would establish eligibility in specific circumstances where it is not appropriate to compare actual turnover in a quarter in 2020 with actual turnover in a quarter in 2019

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The JobKeeper Payment rate

From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:

• $1,200 per fortnight for all eligible employees who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average; and
•  $750 per fortnight for other eligible employees and business participants.

From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:

• $1,000 per fortnight for all eligible employees who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for business participants who were actively engaged in the business for 20 hours or more per week on average; and
• $650 per fortnight for other eligible employees and business participants.

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Who are eligible Employees

Employees are eligible in the extension period if they:

• are currently employed by an eligible employer (including if you were stood down or rehired)
• were for the eligible employer (or another entity in their wholly-owned group) either:
  • a full-time, part-time or fixed-term employee at 1 July 2020; or
  • a long-term casual employee (employed on a regular and systematic basis for at least 12 months) as at 1 July 2020 and not a permanent employee of any other employer.
• were aged 18 years or older at 1 July 2020 (if you were 16 or 17 you can also qualify if you are independent or not undertaking full time study).

Were either:

• an Australian resident (within the meaning of the Social Security Act 1991); or
• an Australian resident for the purpose of the Income Tax Assessment Act 1936 and the holder of a Subclass 444 (Special Category) visa as at 1 March 2020.
• were not in receipt of any of these payments during the JobKeeper fortnight:
  • government parental leave or Dad and partner pay under the Paid Parental Leave Act 2010; or
  • a payment in accordance with Australian worker compensation law for an individual’s total incapacity for work.

Only one employer can claim the JobKeeper Payment in respect of an employee

The self-employed will be eligible to receive the JobKeeper Payment where they meet the relevant turnover test, and are not a permanent employee of another employer. Employees will continue to receive the JobKeeper Payment through their employer during the period of the extension if they and their employer are eligible and their employer is claiming the JobKeeper Payment. However, the amount of the JobKeeper Payment will change at the rates set out above.

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Further Information

Please contact our office if you wish to discuss your personal circumstances and how to meet the eligibility criteria.

The government has announced that the current $1,500 per fortnight JobKeeper payment will continue past 27 September. However, it will be reduced to $1,200 per fortnight from 28 September, and $750 per fortnight for employees working less than 20 hours a week.

From 4 January, the rate will fall to $1,000 per fortnight and $650 for people working less than 20 hours a week.

Full details of the updated JobKeeper program can be found here.

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New Eligibility Tests

Businesses looking to remain on JobKeeper beyond 27 September will be required to meet new eligibility tests.

Businesses will still be required to demonstrate the required reduction in turnover i.e. 30 per cent for businesses with turnovers of $1 billion or less, 50 per cent for those with turnover of more than $1 billion, and 15 per cent for ACNC-registered charities.

The current JobKeeper programs requires a business to apply the test for one period (a month or a quarter) prospectively. However, the government will now require businesses to reapply the tests for the June and September quarters to be eligible for JobKeeper beyond September.

In addition, businesses will need to demonstrate that they have met the relevant decline in each of the three quarters ending on 31 December 2020 (June, September and December quarters) to remain eligible for the payment from January 2021 to March 2021.

We will continue to update this post once more details are known.

Please contact your MGI South Queensland advisor should you have any queries.

 

The Palaszczuk Government has passed legislation to introduce a portable Qld long service leave scheme for workers in the community services industry. This bill was delayed due to the COVID-19 pandemic.

The exact start date of this scheme is still unknown, but we expect that it will start later in the year (and not backdated from 1 July 2020).

The recent media release provides some more detail.

The scheme works by employers registering and providing a ‘return’ to QLeave about the service and earnings of the workers covered by the scheme for each return period, then paying a levy based on the earnings reported.

The levy rate is proposed to be 1.35 per cent of a worker’s gross ordinary wage, lower than the 1.67 per cent average employers currently have to make provision for and will be subject to review at least every two years.

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Which Organisations will be Impacted?

The proposal is for organisations operating in the following sectors (but not limited to):

• Aboriginal and Torres Strait Islander community services
• Accommodation support
• Advocacy services
• Alcohol and other drug support services
• Child safety and support
• Community development
• Community education
• Community health services
• Community legal services
• Counselling services
• Disability emergency response
• Disability support
• Employment services
• Family and domestic violence services
• Financial counselling
• Foster care and out-of-home care
• Home and community care
• Homelessness support
• Lesbian, gay, bisexual, transgender, intersex or queer services
• Mental health services
• Migrant and multicultural support services
• Offenders transitioning services
• Respite
• Seniors community support services
• Social housing
• Violence prevention services
• Women’s services
• Youth justice services
• Youth support services.

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What does this mean for my organisation?

1.      From the inception date of the scheme (yet to be confirmed), community services organisations will pay employees long service leave to Qleave – not just simply accrue long service leave. This will have a cash impact on the organisation, and your 2020/21 financial year budgets.

2.      It is expected that LSL already accrued will stay as a liability on the employer’s balance sheet for LSL accrued up to the inception date (not paid as a lump sum to Q Leave); but after this, no further LSL will be accrued as a liability on your balance sheet (it will be paid to Q Leave as it is accrued by employees).

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How Can MGI Help You

If you are a Community Organisation that may be impacted and need assistance understanding the potential financial impact and employees entitlement to long service leave, please contact us for a free consultation.

The government has announced that the $150,000 instant asset write-off for businesses will be extended to 31 December 2020. It was previously set to finish by 30 June 2020, when the threshold was going to revert back to $1,000.

The threshold will now apply from 12 March 2020 to 31 December 2020 with eligible businesses being those with an aggregated turnover of less than $500 million. There is no limit to the number of assets a business can claim under this threshold. Both new and second-hand assets are eligible.

Should you wish to take advantage of this incentive, please contact your MGI South Queensland advisor.

When Should Clubs Re-Open For Business To Ensure Their Survival?

It has been a difficult time for the Hospitality/Clubs industry during COVID-19 over the past 3 months. With the recent roadmap released by Queensland Government for easing restrictions over three stages, many clubs are now faced with the challenge of when they should open to be financially viable.

Before you consider re-opening, you should seriously consider these questions:

• Have you completed any financial modelling,  including break-even analysis to plan ahead and minimize your business risks taking the roadmap into consideration?
• Are you opening just for the sake of opening, which may be negatively impacting your long term financial sustainability?

As specialists in the Hospitality industry, MGI South Queensland Accountants, Business Advisors & Auditors can help you make the right decisions about when you should re-open your club to make financial sense.

MGI South Queensland is offering a FREE 1 HOUR CONSULTATION with one of our experienced Accountants to help guide you make the right decisions for your club.