Home Topics Small Business Redundancies looming post-JobKeeper

Redundancies looming post-JobKeeper

The JobKeeper scheme has done incredibly well in terms of protecting many jobs and livelihoods, but it fails to address the looming problem of incoming redundancies and folding businesses. 

COVID-19 has significantly changed the business landscape. September (when the scheme ends) will look extremely different to this year’s February, which now seems to be in the very distant past.

By the time the JobKeeper ends, many of those protected jobs will no longer be required, at least in the same way or in the same volume. The government hasn’t yet addressed the question of what will happen to those ‘kept’ jobs that aren’t required come September. What will the economic impact of these redundancies and collapses be, and what scheme is in place to address it?

In a recent interview with Senior Barrister, Ian Neil, we spoke extensively about the JobKeeper scheme with particularly attention to the hot topic of employees returning to work – mainly their refusal to do that and if it was legal or not. Ian also spoke about this problem of expected future redundancies, labelling it a “big, real issue.”

Ian said, “The JobKeeper scheme was to preserve actual, real jobs and it’s been very effective at that – strikingly successful – but it has preserved those jobs effectively as they were in April.”

“All the while the world has been changing, the economy has been changing. There will be massive structural changes. Perhaps the most striking change that everyone will have encountered is that we’re now in the first recession that we’ve had in Australia in almost thirty years. That’s a massive change. The JobKeeper scheme is preserving jobs against those changes.

“It’ll all come to end on the 27th September and what will happen then is, the jobs of April – preserved under the JobKeeper scheme – are going to confront the realities of September, and they will fall off a cliff. The JobKeeper scheme hasn’t addressed that and many people would suggest the government hasn’t fully appreciated the scale of that.

“Particular businesses … are just not going to need the jobs anymore – either as many, or the same jobs as they once had. If at the end of September there really is no need for someone to do the job that a worker or a group of workers has been doing for a business, then those workers will be redundant.

“The JobKeeper has prevented everyone from the consequences of that, but after the scheme comes to an end, that problem has to be confronted. What will be done with those jobs? Can changes to the jobs be negotiated with the employees affected to keep them in a job? If not, are they redundant, and if so, how are those many redundancies going to be paid out? That’s all looming.”