COVID-19 and Insurance Update - 06/05/2020
While COVID-19 and the social distancing restrictions may have changed the way we can do business, EBM remains committed to working with you through these difficult times and offering the same personalised service we always have.
Your Account Manager is available to meet with you by phone or through a virtual meeting. We will continue to stay in regular contact to ensure you have the information and resources you need. Please do not hesitate to contact your Account Manager should you have any questions or concerns.
Privacy and data protection in the COVID-19 era
While working from home has presented many businesses with cyber security threats they may not have anticipated, business owners should review their cyber defences to protect their online systems and information.
Tips to improve cyber security
The Australian Cyber Security Centre’s (ACSC) new guidance outlines nine important but simple cyber security practices for people who are working from home to limit risks, as follows:
- Beware of scams
- Use strong unique passphrases
- Implement multi-factor authentication
- Update your software and operating systems
- Use a virtual private network (VPN)
- Use trusted Wi-Fi
- Secure your devices when not in use
- Avoid portable storage devices
- Use trusted sources of information
For more information on cyber security advice for organisations and individuals, visit ACSC.
Working from home and cyber insurance
Regardless of whether a business owner has been on the front-foot when it comes to cyber security and protecting privacy and data as employees work from home, risk management is paramount. Risk strategies should include having a robust Business Continuity Plan, training staff, prioritising IT security measures, accessing authoritative risk management advice and ensuring an adequate Cyber Liability policy is in place.
Whether a business’ Cyber Liability insurance policy extends to cover staff operating from home will depend on the policy wording. Some policies will only respond if the policyholder notifies the insurer of the change in operations and policyholders should check if the cover extends to the employee’s personal computer system.
If the policyholder is doing something different to the norm (such as allowing staff to work from home), then the normal rules of disclosure apply, and the underwriter should be advised in advance. Please contact your EBM Account Manager if you have any questions or would like to find out more on Cyber Liability.
Ultimately, good risk management will always be a great investment – and an important element in business sustainability through these challenging times.
The Government’s JobKeeper wage subsidy program is designed to help businesses affected by COVID-19 to cover the costs of their employees’ wages, so that more employees can retain their job and continue to earn an income.
The JobKeeper subsidy is temporary and applies to the period from 30 March 2020 to 27 September 2020 with applications for the subsidy closing 31 May 2020. For more information, please refer to Australian Government - The Treasury.
There have been several updates on JobKeeper payments over the last week, as outlined below.
JobKeeper payments and wages declaration
At this time, Western Australia, South Australia, Queensland, New South Wales and Victoria have advised of their position on JobKeeper Payments for the purposes of Workers’ Compensation premium calculations, as outlined below.
WorkCover WA – As of 4 May 2020, WorkCover WA has advised of their position in relation to workers’ compensation wage declarations. The General Principles outlined by WorkCover WA include:
- The amount of wages declared should reflect the amount payable to workers for the time or period that work is done. JobKeeper is a top-up or subsidy payment and not a payment for work done.
- Wages are not required to be declared for workers stood down and not required to work – even if wages are subsidised by JobKeeper payments that the employer receives.
- Wages must be declared if employers continue to engage workers and pay their wages for work done in exchange for their actual labour or service – even if the wages are subsidised by JobKeeper payments that the employer receives.
- However, where employers are paying additional amounts to workers because the worker’s wages are otherwise less than the JobKeeper ‘wage condition’ of $1,500 per fortnight, then only the wages for work done must be declared. Any top up amount as part of JobKeeper payments, should not be declared.
NSW State Insurance Regulatory Authority – As of 29 April 2020, the NSW State Insurance Regulatory Authority has advised that an employer’s workers compensation premium is calculated based on the wages paid by the employer during the period to which the related workers compensation policy applies. The extent to which JobKeeper payments made by employers are considered ‘wages’ will impact the calculation of workers compensation premiums.
- It has been determined that JobKeeper payments made to workers who performed no work during the period to which the payment relates will be excluded from the amount of wages used to calculate premium.
- This decision has been taken on the basis that workers who do not perform any work are at a significantly reduced risk of sustaining a work-related injury compensable under the workers compensation system, and payments to these workers should therefore not impact premium.
- It has been determined that JobKeeper payments made to workers who continue to perform work (whether in their usual or a reduced or otherwise augmented capacity) will continue to be included in the amount of wages used to calculate premium.
- This decision has been taken on the basis that workers who continue to perform work continue to be at risk of sustaining a work-related injury compensable under the workers compensation system, and payments to these workers should therefore continue to impact premium.
WorkSafe Victoria - As of 5 May 2020, WorkSafe Victoria has advised that the exact impact on the premium will depend on the employment circumstances of each eligible employee for whom the payment is being claimed. Please refer to the information provided by WorkSafe Victoria:
What does this mean for my WorkCover premium if JobKeeper eligible employees have been stood down?
- If, as an employer, you are eligible to receive the JobKeeper Payment and your employees have been stood down from work, and not working in any capacity, the entire JobKeeper Payment will not be included in your rateable remuneration estimate or certification.
What does this mean for my WorkCover premium if JobKeeper eligible employees are working and would normally earn less than $1,500 per fortnight?
- If, as an employer, you are eligible to receive the JobKeeper Payment and your employees would normally earn less than $1,500 per fortnight and you are providing an ‘additional’ payment to comply with the JobKeeper Payment requirements, the JobKeeper ‘additional’ amount does not need to be included in your rateable remuneration estimate or certification.
What does this mean for my WorkCover premium if JobKeeper eligible employees are working and would normally earn more than $1,500 per fortnight?
- If, as an employer, you are eligible to receive the JobKeeper Payment and your employees would normally earn more than $1,500 per fortnight and you are continuing to pay them this amount, receipt of the JobKeeper Payment has no effect on your rateable remuneration.
What does this mean for my WorkCover premium if JobKeeper eligible employees are working in a reduced capacity?
- If, as an employer, you are eligible to receive the JobKeeper Payment and your employees are working in a reduced capacity and you are providing an additional payment to comply with the JobKeeper Payment requirements, the JobKeeper portion would not be included as rateable remuneration.
WorkSafe Victoria Information for Employers and Frequently Asked Questions provides additional details including a table and examples as well as information on how to adjust remuneration, what records the employer need to maintain and minimising the impact of any JobKeeper Payments.
As more information becomes available on JobKeeper payments and wages declaration for each state/territory, we will provide an update.
New Employer Toolkit
A new COVID-19 planning toolkit for Australian businesses has been added on the Safe Work Australia website as a resource to help navigate work health and safety laws as employees return to work. The toolkit outlines how employers can achieve a secure environment, from personal hygiene to social distancing to what to do in case of a suspected outbreak of the virus at work.
COVIDSafe app launched
The Australian Government recently launched a COVIDSafe app to help state and territory officials quickly contact people who may have been exposed to COVID-19.
For more information or to download the app, visit health.gov.au.
Here to help
As the situation is evolving quickly, we will do our best to keep you informed. If you have any questions, please contact your EBM Account Manager on 1300 755 112 for further information.