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Business Insights – 8th June 2021 – Vic employment grants

In this update for business owners on 8th June, I provide insight on a new and lucrative Victorian employment grant.

We’ve been watching a grant that was announced in the Victorian state budget in November last year. Some information about the grant was released several months ago, but more clarification has been provided in recent weeks.

There have been many incentives announced over the last year to promote jobs. Some have worked – such as the apprentice/trainee scheme – which many Tenfold clients have taken advantage of. (For more info on this scheme, see my briefing here of 14 May 2021 on training support). Other incentives haven’t worked as well, such as JobMaker Hiring Credit – there are too many tight criteria which has meant it isn’t applicable for many Tenfold clients. (And for more info on that scheme, see my briefing here of 6th November 2020)

I’ve been researching this new Victorian grant, and this is one that is going to be lucrative for businesses that are growing fast, with potential for other businesses to benefit as well.

Overview of Jobs Victoria Fund

This new grant from the Victorian Government provides 12-months of wage subsidies for employers who hire from priority groups, which include:

  • people most affected by the pandemic, particularly women
  • people who already face significant barriers to employment

The funding is aimed to get these Victorians into permanent roles for a minimum of 12 months, on part-time or full-time basis (not casual) and with at least 19 hours of work per week.

There are 2 levels of priority groups for wage subsidies:

  • Level 1 wage subsidy is worth $20,000 for each person you employ from the priority groups in this category.
  • Level 2 is worth $10,000 for each person you employ from the priority groups in this category.

Level 1 wage subsidy priority groups

  • women over 45 years
  • long-term unemployed people (unemployed for six months or more)
  • jobseekers registered with a Jobs Victoria Partner (see Appendix A)
  • Aboriginal and/or Torres Strait Islander people
  • people with disability

Level 2 wage subsidy priority groups

  • young people aged under 25
  • people over 45 years

Full-time or part-time employment

  • The level of the wage subsidy available is calculated pro rata based on whether the job is full-time or part-time. For the purposes of this Fund, full-time employment is 38 hours per week and any part-time jobs must be for a minimum of 19 hours per week.

Your new employee must have started working with you on or after 16th March 2021. You must apply for the grant within the first 12 weeks of their permanent employment.

For this grant, you must first employ the person, then apply for the grant. You can’t make their employment contingent on you getting the grant.

 

Key criteria that you need to be aware of

  • To be eligible, employees must have been unemployed before they started working for you.
  • It also extended to people who have been underemployed. So if you have someone working less than 16 hours per fortnight on a casual basis, then you can be eligible for this grant if you convert them to permanent (part-time or full-time) on an employment contract of greater than 18 hours per week.
  • There is no minimum period they must have been unemployed. They don’t need to have been registered as unemployed.
  • An employee is also eligible if they were employed by you as a casual and working less than 16 hours per fortnight and you are now upgrading them a permanent employee with at least 19 hours per week

 

Other incidental criteria you need to comply with

  • If the employee is in more than one priority group, the higher wage subsidy applies.
  • If you are seeking a wage subsidy for more than three employees, you must provide at least 60% of the subsidised roles to women.
  • You must be the direct employer of the employee
  • Your payroll must be less than $20M for the previous financial year
  • Your new subsidised employee must be a resident of Victoria
  • You can apply for wage subsidies to increase your current staff numbers by up to 20 per cent. For example, if you have currently have 15 employees, you can get wage subsidies for 3 additional new employees
  • Jobs must not displace existing employees
  • Wage subsidies can be provided to a maximum of 20 FTE employees over the life of the fund
  • The full-time salary of the new employee must be below $120,000 pa (excluding super) (or pro rata for part-time roles)
  • Also eligible are people who worked as part of the Working for Victoria initiative.

 

How it works

As the employer, you will receive 3 payments over the course of 12 months, as follows:

Payment 1: paid to you when you submit payslips to confirm your new employee’s employment. (For a Level 1 employee this instalment is $6000, Level 2 is $3000)

Payment 2: paid to you 26 weeks after your employee starts working with you. (For Level 1, the instalment is $6000, Level 2 is $3000)

Payment 3: paid to you 52 weeks after their start date. (For Level 1, the instalment is $8000, Level 2 is $4000)

  • You’ll need to provide payslips for your employees that show continuous employment for the period of wage subsidies.
  • Payments are only made where they have had continuous employment of 26 weeks (for payment 1) and 52 weeks (for payment 2).
  • You’ll also need to provide a statutory declaration as part of the application process.
  • If the amount of your grant exceeds $100,000, you’ll need to get an audit opinion at your own cost.

 

Things to know

  • You can be receiving other incentives (state or federal) in addition to the Jobs Victoria Fund wage subsidy.
  • Successful applicants will be entering into a legal agreement with the Victorian Government. Be aware of your obligations as an employer entering into an agreement like this. The onus is on the employer to comply with things like a statutory declaration.
  • If you receive the funding, you may be subject to a range of compliance and probity processes, including an independent audit. As part of this process, recipients are required to answer any enquiries from the Department and/or an independent auditor, and to permit inspections and access to project accounts, employment records, project assets and project sites.
  • Any applicant or recipient found to have used false or misleading information may be referred to the relevant law enforcement authority

 

Wrapping it up

This grant could be highly beneficial for Victorian businesses who are expanding and may employ people in the priority categories. In many cases, this is a grant to employ people who you would have employed anyway.

Work with your business coach to see how this funding opportunity might apply to planned increases in your workforce or recently hired people.

This is a complex grant so visit the Jobs Victoria Fund website to review it in detail – click here for Jobs Victoria Fund website. However, don’t be put off by the complexity – the financial support available through this grant could be very useful for Tenfold clients with growing businesses. We will help you with interpreting which situations and which employees you may be eligible for.

If you feel you may get tripped up on the unemployed/underemployed criteria, speak to a Tenfold business coach as we have been in contact with the Jobs Vic (we have a reference number for the advice we obtained, which means you can act on it) and we can provide you with further information based on your specific circumstances.

Ash

Ashley Thomson B.Eng. (Hons), Grad. Dip. Mgmt, MEI
Managing Director
Tenfold Business Coaching

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