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SMEs and WA’s Eased COVID Restrictions

On Tuesday 26 April, the State Government announced that as of 12.01am Friday 29 April, prevailing COVID restrictions will be eased, thanks to WA’s ‘soft landing’ off the back of our Omicron peak confirmed by public health data. This is undoubtedly great news for West Australians – it means that we have come through this latest COVID wave with minimal impact relative to the rest of the world, we can now enjoy most of our daily activities without a mask should we choose to do so, and businesses will no longer be restricted by capacity and density limits. With this new set of rules and removal of many COVID restrictions, there is plenty to be positive about, as well as some important considerations for SME owners around their customers and staff.

Revised Small Business Hardship Grants & Payroll Tax Waiver

The Small Business Hardship Grants Program was brought in to provide financial support to businesses negatively impacted by Level 2 public health and social measures. On 27 April, this program was revised and expanded to a two-tier system, from the original one tier of businesses who experienced a 40% turnover reduction. As a result of these revisions, businesses must satisfy the following criteria:

• Have a valid and active Australian Business Number (ABN).
• Have an Australia-wide payroll of less than $4 million.
• Have an annual turnover of more than $50,000, excluding GST.
• Be able to demonstrate a reduction in turnover for any consecutive two-week period between 1 January 2022 to 30 April 2022, compared to the equivalent period in 2021*.
• For the 40 per cent tier, a reduction of at least 40 per cent.
• For the 30 per cent tier, a reduction of at least 30 per cent.

*An alternative period in 2021 may be used if the business did not operate at that time or it provides an inaccurate representation of the business’ financial situation.

Grants will be paid depending on a successful applicant’s reduction in turnover for the period in question, and the number of Full Time Equivalent (FTE) employees in the business. Applications for these grants closes Thursday 30 June 2022. The following table outlines the grant available based on turnover reductions and FTE employees.

The Payroll tax waiver for large hospitality businesses is also still in play. Those businesses with a payroll of $4 million to $20 million will be eligible for a three month payroll tax waiver, provided they have sustained at least a 40% reduction in turnover over any four week period between 1 January 2022 and 30 April 2022, comparable to the same period last year.

Capacity & Density Restrictions Lifted

Perhaps the most important COVID restrictions to be lifted in this latest announcement are those relating to venue capacity and density limits. The 2 square metre rule has been in place for almost the entire pandemic, bar a few months in mid-2021, as have various restrictions on venue capacity. This meant many SMEs, particularly those in the hospitality industry, had to limit the amount of people they could serve at any one time, losing out on potential customers over an extended period of time. Now that these have been lifted, such venues are now free to open their premises up to pre-pandemic levels.

This comes as a welcome relief for owners of cafés, restaurants, pubs, clubs, and similar establishments, many of whom have struggled for the last 2 years to keep afloat, and have seen other businesses in their respective industries go under. The key for these businesses now is to make the most of this increased capacity and get their cash flow back on track.

Proof of Vaccination Requirements

Once COVID-19 vaccinations were rolled out on a large scale the WA State Government brought in mandatory vaccination proof requirements for certain venues. Patrons were required to show their proof of vaccination to dine in at cafés and restaurants, enter nightclubs, pubs, stadiums, gyms and a range of other venues, as well as to visit hospitals and residential aged care facilities. This will now be eased, so as of 12.01am Friday 29 April proof of vaccination will only be required to visit hospitals and residential aged care facilities, and mandatory workplace vaccination requirements will remain in place.

This may further improve the prospects for SME owners operating in the hospitality and entertainment industries, as the relatively small portion of West Australians that didn’t meet vaccination requirements can now attend these venues.

Close Contacts – New Protocols

The protocols surrounding close contacts of known COVID-19 cases have been adjusted. Now, close contacts with no symptoms are not required to complete 7 days isolation, but must undertake a daily Rapid Antigen Test (RAT), wear a mask when not at home, avoid high-risk settings (e.g. hospitals, disability and aged care facilities, correctional facilities), work from home where possible, and avoid non-essential gatherings. Close contacts are also obliged to notify their employer of their close contact status.

Changes to COVID restrictions may not solve all staff availability problems, however, they should allow most to continue working. If you operate a business that doesn’t offer working from home options (e.g. a café or restaurant), an employee that satisfies the above criteria can still come to work. If your business does have an existing working-from-home framework, consider encouraging close contacts to take advantage of this even if they are asymptomatic. A close contact that later tests positive will need to complete their 7 days isolation, so ideally, they won’t have been in the workplace and potentially spreading the virus to other staff members.

Masks

Bringing much relief to the community, face masks will no longer be mandatory for people aged 12 years and over, except for public transport, taxis and rideshare services; airports; and high-risk settings such as hospitals, residential aged care and disability service facilities, and correctional facilities. While there is no requirement for people to wear masks as of 29 April, it is still encouraged where physical distancing isn’t possible. For your own business this might include asking staff to ensure they wear a mask when serving customers at a counter, when using a lift, or in smaller shared spaces like a kitchen or bathroom.

Given the fact that an outbreak of COVID in your workplace will still impact the availability of any staff who test positive, now is certainly not the time to get complacent. The health and safety of your team and your customers should remain a priority.

Looking Ahead

With only a few COVID restrictions still in place, WA is looking more and more like it did pre-pandemic. SMEs are now in a great position to capitalise on the increase in travellers into the state, fewer public health and social measures impacting their operations, and a strong economy to back increased spending. Barring any major caseload spikes, the likelihood of returning to these restrictions appears low for the time being. As we return to “normal”, optimism in the SME community is high.

If you’re ready to take advantage of WA’s strong position and the lifting of these restrictions, the CFO2GO and Business Services teams at McKinley Plowman are here to help you do just that. Let us focus on your bookkeeping, compliance, and tax returns while you focus on growing your business. Give us a call today on 08 9301 2200 or visit www.mckinleyplowman.com.au/contact-us/ to see how we can assist you.

More information: COVID-19 Business Grants (Small Business Development Corporation)

written by:

Claire Ginbey

Heading up our CFO2GO team, Claire's skills as a SME Business Specialist and cloud accounting specialist have developed in line with advancements in technology and best practice; allowing her to maintain the highest service standards for clients.

Claire's passion for growing small businesses and helping them achieve sustained success is what motivates her to continuously develop her skills and knowledge. Her clients appreciate her considered and dedicated approach to working with them, and her personal oversight across their operations and financial performance.