JobKeeper Exec Bonuses and Dividends Were Built into the System
Lisbeth Latham
In the last week, news has leaked regarding companies in receipt of JobKeeper wage subsidies either paying their executives large bonuses or paying out dividends to shareholders. This development has led to claims that these companies are rorting JobKeeper. However, while these payments are clearly immoral, far from being a rorting of JobKeeper, they are entirely consistent in the government’s intent of JobKeeper as primarily a subsidy to business.
When JobKeeper was legislated I described it as “for companies still employing people in work, the subsidy is more a subsidy to their profits rather than a wages subsidy”. This was because rather than provide a wage subsidy from which workers could build their income towards their pre-COVID level if work was available, the subsidy established an amount of payment which eliminated the need for a business to pay its workers wages for their work until they had performed the equivalent amount of work as the subsidy. This had the effect of both ensuring that hundreds of thousands of workers experienced a significant decline in their income whilst companies and organisations could redirect revenue that would normally have gone to covering wages to other things including paying executive bonuses and dividends to shareholders.
So while people are right to be angry at companies prioritising bonuses and dividends, we need to be clear - they aren’t “rorting” JobKeeper, they are using it precisely how it was designed to be used. The actions of these companies demonstrate the pressing need for a genuine wage subsidy scheme that guarantees the incomes of all workers regardless of contract type or residency status.
Posts
0 comments:
Post a Comment