JobKeeper: who gets it, who doesn’t, and what that means for women

In partnership with the National Foundation for Australian Women (@NFAWomen), we are running a series of pieces that analyse how the Covid-19 pandemic is differentially impacting on women. In today’s analysis Kathy McDermott of NFAW provides the first in a three-part series that looks at women and employment. Today’s piece examines the JobKeeper payment.

Because employment is gendered, the impact of the coronavirus on employment is also gendered. Because women are disproportionately represented in direct contact employment and the retail and hospitality industry, more women than men are losing their jobs -- 272,816 in hospitality alone as of 23 April.

Women are also disproportionately represented in frontline crisis response roles: 80 per cent of healthcare workers are women and 70 per cent of pathology services are provided by women. Women predominate in most of the essential support services and among the workers that cannot stay home: the teachers, aged and childcare workers and hospital cleaners. Social services are under pressure from the virus and most social service providers are women: social workers, mental health support workers, frontline domestic and family violence workers, child support workers.

Because employment impacts of COVID-19 are gendered, so are the impacts of the measures taken by the government to address employment. This 3-part analysis looks at:

• the impact on women of JobKeeper: who gets it, who doesn’t, and how it compares with the earnings it replaces (this piece);

• changes being made to the rules of work: where and what they are, and what longer-term threats they pose to employee rights (part 2); and

• the public image of frontline and social services work, and its implications for equal pay (part 3).

What is JobKeeper?

Under the JobKeeper Payment, businesses affected by the coronavirus are able to access a subsidy to continue paying their employees. Businesses with a turnover of less than $1 billion are eligible if their turnover has fallen by 30 per cent or more; those with a turnover of $1 billion or more are eligible if their turnover has fallen by 50 per cent or more; charities and not-for-profits are eligible if their turnover has fallen by 15 per cent or more.

These businesses can receive a fortnightly payment of $1,500 from JobKeeper for a maximum of 26 weeks for each employee that was on their books on 1 March 2020 and is retained or continues to be engaged by that employer.

The good news for women

Available data suggests that, on current trends, those employees are more likely than not to be women, because women are more likely to do contact service work in industries directly impacted by trading restrictions introduced in response to COVID-19. These include those in the hospitality, tourism and transport, personal service and the entertainment and retail sectors.

The majority of workers currently directly impacted are those in low-paid part-time, female-dominated occupations. Data analysis conducted by Rebecca Cassells and Alan Duncan for Bankwest Curtin Economics Centre shows that most of these workers would be more than fully compensated under JobKeeper. That is, around 4 in 5 part-time workers will be better off receiving a $1500 fortnightly JobKeeper payment than they would be receiving their current average weekly wages, which are typically far lower than $750.

Women are more likely to be in casual and part-time employment, and their jobs are more likely to be impacted by the Coronavirus measures, when compared to men. Will JobKeeper provide the safety net women need? Photo by Ksenia Chernaya from Pexels

For example, part-time sales assistants earn on average $451 a week. If these workers were retained on the books by an eligible employer and received the weekly JobKeeper payment of $750, the average part-time sales assistant would gain $299 per week.

Drawing on ABS data,[1] Cassells and Duncan look at the average weekly earnings people in COVID-19-vulnerable occupations such as sales assistants, bar attendants and baristas, café and restaurant managers, waiters, chefs, kitchen hands, beauty therapists, fitness instructors, tourism and travel advisers, gallery, museum and tour guides, hotel and motel managers, fast food cooks, retail managers, air transport professionals, and music professionals. Broadly, the average worker in many of these occupations would receive between $200 and $400 more each week than the normal salary for their role. Only air transport professionals will be worse off; others will gain anywhere from $69 (retail managers) to $470 (fitness instructors).

Of course the use of averages in these comparisons masks the spread of the underlying wage distribution, but the fact remains that, on average, only 445,000 (20%) of the 2.2 million part-time workers will receive less than wage replacement.

In the case of full-time workers, the JobKeeper package will deliver less than full wage replacement for 3.9 million (93%) of the 4.1 million people in the vulnerable occupations analysed by Cassels and Duncan. This group will have to receive employer top-ups or cuts to weekly hours to ensure their hourly entitlements are respected.

Women – who form the bulk of lower paid part-time workers – are likely to do best out of JobKeeper. There are three possible reasons why the payment was designed like this. First, and most obviously, the flat $1500 fortnightly rate is simplifying the roll-out.  Secondly, targeting lower-paid employees is likely to have a stronger stimulus effect. Certainly recently published real-time analysis of the earlier one-off $750 coronavirus stimulus payment targeting lower-income people shows that that payment had the effect of arresting the nationwide collapse in consumer spending caused by the coronavirus outbreak.

The third possible reason for these flat-rate payments that favour part-time and lower-paid women is the need to keep the many women in industries critical to the pandemic response in active contact with their employers. That issue is covered below, in the discussion of social infrastructure.

That, to the extent that there is any, is the good news.

The bad news for women

The bad news includes both the exclusions from JobKeeper and the increasing evidence of various forms of rorting of the scheme by employers.

Casuals who have worked for a business for fewer than 12 months (other than some New Zealanders), local council workers and temporary visa holders are excluded from the scheme. Women are disproportionately represented in the short-term casual roles that are currently ineligible for the JobKeeper support, especially those in the hospitality, health care and retail sectors. Cassels and Duncan estimate that there are around 950,000 ineligible casual workers, with the majority employed in the accommodation and food services, retail trade, and health care and social assistance sectors. A higher share of these workers are women.

Many of these women will, however, be eligible for JobSeeker payments, including the temporary coronavirus supplement, and some, particularly those in part-time work, will still be better off with the $1100 a fortnight in the JobSeeker payment. But this group has lost any ongoing connection with an employer.

The situation of temporary visa holders is unrelentingly bad news. The government has advised most temporary visa holders with work rights  to access their Australian superannuation to help support themselves -- if they have any superannuation and in the unlikely event that it will be sufficient to enable them to survive for very long.  Remember than many in this group have had little time to build superannuation accounts.

Many temporary visa holders have also been victims of wage theft and most of those victims who try to get their wages and superannuation back are not successful. Temporary visa holders who are unable to support themselves under these circumstances have been told “it's time to go home, and they should make arrangements as quickly as possible.”  In practice this means that many such migrants may be made homeless or will be forced to live in crowded situations and may be forced into illegal work.

The second class of bad news is the rorting of the JobKeeper scheme by some employers. In some cases such ‘rorting’ is of a piece with the broad confusion caused by the fast roll-out of the scheme and associated operational issues. For example, the scheme relies on reimbursing employers, which in turn means that they have to pay up front for employees for whom $750pw may represent more than their usual wage. Employers are also expected to be making fortnightly prepayments of sums they receive monthly in arrears. The resulting cash flow issue has caused great anxiety to many smaller, already hard-pressed employers and their employees.

A subset of employers are, however, taking advantage of the confusion surrounding the operation of the scheme by means that have been described as an application of the strategies of wage theft to the opportunities offered by JobKeeper. One specialist in employment law reports that they have already seen cases of employers taking advantage of the scheme, with some sacking workers so they don't get the benefit and others lying about being eligible. "We have a wage theft epidemic in this country," he said. "We just see example after example of bigger and bigger wage theft. "Employers who have stolen from their employees in the past will steal from them again, and they will use this scheme to their advantage rather than passing on the benefits to employees."

One Parliamentarian has already reported receiving a complaint that the familiar ‘cash-back’ model of wage theft is being recycled, with employees receiving JobKeeper payments being pressured into returning a proportion of those payments to their employer. JobWatch has also reported that:

"Some employers are actually reaping the benefits and passing on the burden to their employees."  She said the service has dealt with workers who aren't being paid the full subsidy and where employees are being forced to work additional hours to 'earn' the full benefit. "Another case was the employer informed all staff that they would be applying for JobKeeper, but said they would not be using the payments to pay staff at their ordinary rate," she said. "But instead they would use it to pay staff at a reduced rate and use the remainder to support the business”.

The Prime Minister has responded to reports of employer rorting by noting that those concerned will feel the full weight of the law and be cut off from further payments. But it is hard to see how that will benefit their victims, who will be moved  from JobKeeper to JobSeeker.

Notes:

[1] ABS Labour Force Quarterly Detailed, Cat No.6291.0.55.003 Feb 2020, ABS Employee Earnings and Hours Survey Cat No.6306.0., May 2018. ABS Census 2016.

This post is part of the Women's Policy Action Tank initiative to analyse government policy using a gendered lens. View our other policy analysis pieces here.

Posted by @SusanMaury @GoodAdvocacy