Companies that do opt into the JobKeeper scheme need to consider how the requirement to pay first and be reimbursed by the Government might impact them.
A key question that company directors need to consider, Louise says, is “if they go down that road, paying first and being reimbursed by the Government, it may raise the question of are they trading in insolvency.”
While the COVID-19 insolvency provisions relax the rules around insolvent trading for a six-month period, it isn’t a cure-all and requires specialist planning and advice.
The most important thing for everyone managing these changes, Louise says, is that the law still applies.
“It’s not a case of heaven knows, anything goes,” she says. “It is the case that you’ve got a system so make sure you understand how it works.”
Employees must remember, Louise emphasises, that these COVID-19 provisions do not replace existing employment law.
“Big bodies of law like unfair dismissal and adverse action, which is when you damage a person in their employment, that’s still there,” she says.
Likewise, company directors also need to remember that they are bound by existing legal frameworks.
“They’re still governed by the general director’s duties, including the duties to act in the interest of the company in good faith, and to show reasonable care, skill and diligence,” she says.
For everyone affected, or potentially affected, by these initiatives, Louise recommends seeking advice on your specific circumstances from experts like your accountant, lawyer or the Fair Work Ombudsman.
“All of these laws,” Louise says, “have been done quickly and with very good intentions, and they have the potential to do good. But as with anything in life, you’re well-served to get advice, and be cautious, and think about what these changes mean for you.”
If you have a passion for guiding people through complex issues, explore what you can do with JCU Law.