Self-employment as an approved activity to satisfy mutual obligation requirements 001-09070050

A job seeker, who has mutual obligation requirements and is self-employed, may use their self-employment to fully meet their requirements.

A job seeker can fully meet their mutual obligation requirements through self-employment if:

• the net business income is equal to, or more than, the relevant national minimum wage (for the number of hours required to meet the job seeker's mutual obligation requirements), and
• they are working the required number of hours in self-employment:
• 30 hours per fortnight for:
  - principal carers
  - those with a partial capacity to work (PCW) of 15-29 hours per week and
  - job seekers aged 55 and over

Note: principal carers combining suitable self-employment and other paid work, or self-employment and approved study must complete a combined total of 30 hours per fortnight.

Once the decision is made that self-employment (SEL) activity is approved, coding on the job seeker’s record via Real Estate/Business Details (REBS) screen must be completed before the AEX screen is updated. The details are sent to the Department of Employment and Workplace Relations (DEWR) and the job seeker will be suspended or exited from Employment Provider Services. This suspension or exit is automatic. There is no need for the job seeker to discuss this with their Employment Services Provider. However, the job seeker may choose to volunteer into Employment Provider Services. In these cases, the job seeker must discuss this with their provider.

Note: to view the business details, see the REBS screen.

See Resources for examples of how to determine whether self-employment satisfied mutual obligation requirements.

Go to Step 2.

If the job seeker is declaring self-employment:

• for the first time, (the self-employment has not been approved), go to Step 3
• by lodging a Reporting Statement (SU19) and has self-employment approved, see Step 1 in Table 2
• and has ceased a previously approved self-employment (SEL) activity, see Step 5 in Table 2
• and has a previously approved SEL activity coded on the Activity and Exemption Summary (AEX) screen which has expired, see Step 2 in Table 3
• at an approved activity review, see Step 1 in Table 3

Is the job seeker's assessed income meeting the required number of hours to fully meet their mutual obligation requirements?

• Yes, go to Step 4
• No, go to Step 5

Is the job seeker's net business income equal to or more than the national minimum wage rate for the number of hours required?

That is, 30 hours per fortnight at the national minimum wage for job seekers with part-time requirements and job seekers aged 55 and over. For principal carers doing a combination of self-employment and approved study or self-employment and other paid work, the business income must be equal to the national minimum wage for the agreed hours of self-employment.

• Yes, go to Step 6
• No, go to Step 5

If the self-employment does not satisfy the sufficient work test, the job seeker must do another approved activity entirely or may be able to combine their self-employment with another approved activity. Service Officers must make the relevant updates to the AEX and REBS screens (where applicable).

Note: Services Australia can approve employment combinations for both Centrelink and provider managed job seekers. In the case of job seekers aged 55 and over, Services Australia can approve voluntary work and employment combinations. Services Australia can also approve a combination of self-employment, paid part-time work and/or approved study for principal carers. Only an Employment Services Provider can approve voluntary work or a combination of voluntary work and other activities for principal carers under 55.

If the job seeker is not doing activities that enable them to be Centrelink managed and they are not exempt from mutual obligation requirements, they must be referred to an Employment Services Provider if they have not already been connected.

Employment Services Providers are responsible for negotiating and maintaining the Job Plan for provider managed job seeker.

Advise the job seeker of the decision. Record decision and conversation with the job seeker on a closed DOC.

Investigate other approved activities for the job seeker.

Procedure ends here.

Self-employment must equal 30 hours or more per fortnight for partial capacity to work (PCW) 15-29 hours per week, job seekers aged 55 and over and principal carers. In addition, net business income must also equal or be more than the relevant national minimum wage per fortnight for the number of required hours.

Job seekers assessed with a PCW or temporary reduced work capacity (TRWC) of 0-7 or 8-14 hours per week may fully meet their mutual obligation requirements through self-employment or a combination of self-employment and paid work within their assessed bandwidth.

Principal carers can also combine self-employment and other paid work, or self-employment and study totalling at least 30 hours per fortnight to fully meet requirements, as long as the total remuneration is sufficient for the agreed hours of self-employment.

To update the Self-Employment income in Process Direct:

• Key START into the Super Key
• Select the Self Employment workflow from the Task Selector
• Complete the workflow, after entering the relevant business and self-employment income details required
• See Code the Business Income and Assets details if required

Record the self-employment on the AEX screen in Process Direct using the following codes:

• For job seekers aged 55 and over doing a combination of voluntary work and self-employment, in Process Direct use both codes of 'SEL' and 'VWK' by:
• Go to the Activity and Exemption Summary (AEX) screen
• Select Add
• Complete the Activity Type, Start date and End date, select Save
• Complete the Receipt Date and Channel fields, select Save. Note: a provisional line will display on the Activity and Exemption Summary (AEX) table. For a combined activity, select Add to add the second approved activity
• Select Assess and address any errors/warnings
• Selecting Assess again, then select Finish. Record details of the update on the Finalise screen
• Select Finalise to complete the transaction
• For job seekers doing a combination of self-employment and paid work, follow the above steps and use the code 'PWS'
• For principal carers doing a combination of self-employment and approved study, use the code of 'SSE'

The start date used for the AEX screen should be the date of coding, to ensure details are transferred to DEWR system

• Self-Employment (SEL) should not be coded on the AEX screen for more than 12 months (363 days) at a time
• After the AEX screen is updated, the system identifies if the Job Plan is to be updated. When a new job plan needs to be negotiated, an Action Item message will display stating: “Job Plan requires at least one compulsory requirement. Ensure Job Plan is updated taking into consideration the job seeker's participation category”
• To update the Job Plan:
• Select This image could not be displayed.
  > Participation Summary to view the Key Information screen
• Select the Action Item to be navigated to the Job Plan screen
• Select Negotiate Plan and complete the Job Plan workflow
• The sentence text for SEL activity will display 'I agree to undertake [number of hours] hours per fortnight of self-employment from [Start Date] to [End Date] and will provide my business income details to Centrelink'
• When the Job Plan is negotiated the Action Item is removed

Advise the job seeker they:

• are fully meeting their mutual obligation requirements while they are doing the agreed approved activity
• do not have job search efforts however, they still must declare their participation in the approved activity to Services Australia each fortnight
• will be automatically suspended from Employment Provider Services, however they can voluntarily continue to participate with their provider
• must advise Services Australia of changes about their participation in the agreed approved activity (e.g. cessation of self-employment or increase in income) during the relevant reporting period
• how their mutual obligation requirements may change if their circumstances change
• if they are not connected to a provider or they are suspended or exited from Employment Provider Services, they do not need to attend ongoing provider appointments

Procedure ends here.

Job seekers who are self-employed and have had their business income assessed, only need to report they have met their mutual obligation requirements.

Hours of work - Self-employment must equal:

• 30 hours or more per fortnight if the job seeker has
• a partial capacity to work (PCW) 15-29 hours per week
• aged 55 and over or
• is a principal carer

Business income - The job seeker's net business income must be equal to or more than the relevant national minimum wage rate for the number of hours required. If business income has been assessed and there have not been any significant changes to business activity, they only need to write 'as previously declared' in the earnings section if reporting via a Reporting Statement (SU19) form. If the job seeker is reporting via self service, their business details will be displayed and the job seeker can advise if there has been any change.

Note: any changes to business activity must be notified along with other changes during the reporting process.

Does the job seeker's self-employment income and declared hours of employment still fully meet their mutual obligation requirements?

• Yes, go to Step 6
• No, go to Step 2

• Does the job seeker have an exemption from their mutual obligation requirements? If so, the Service Officer should go to 'reasonable excuse' select 'no excuse' and record the reason why one was not required on a DOC. Process the payment, subject to all other eligibility being met
• If the job seeker requests an exemption from their mutual obligation requirements, ensure they provide evidence to support their reason. Consider the merits of the case and make a decision. If an exemption is granted, code it on the Activity and Exemption Summary (AEX) screen. Process the payment, subject to all other eligibility being met. See Mutual obligation requirement exemptions
• If reporting by self service and the job seeker indicates they have failed to meet their mutual obligation requirements they will need Service Office interactions before their payment is released

Note: in Customer First, an alert pop message will display to remind staff to check the reasonableness of the excuse provided by the job seeker 'Customer has not met their approved activity requirement. Please discuss and determine if the customer is still meeting their approved activity. If the customer is no longer meeting the approved activity, following completion of the report, update the end date of the activity on AEX screen in Process Direct and refer customer back to Employment Service, as appropriate. Report should only be finalised post discussion with job seeker.'

Does the job seeker have a reasonable excuse for not meeting their mutual obligation requirements?

• Yes, go to Step 3
• No, go to Step 5

A reasonable excuse can only be one of the following:

• Illness or injury
• sick child (or children)
• cancelled shift
• short term reduction in hours due to a public holiday (for example, Easter or Christmas)
• pupil free day(s)/school holiday
• no longer undertaking activity
• other
• with an expectation that working hours will return to normal in the next fortnight
• If this is the first reasonable excuse:
• The Service Officer should code the reason through the Earnings and Reporting workflow and process the job seeker's payment as usual
• The Service Officer should advise the job seeker that a maximum of 2 consecutive reasonable excuses may be given
• At the third consecutive fortnight, the job seeker will be subject to a handoff to have a discussion with a Service Officer who will need to determine if the job seeker still continues to fully meet their mutual obligation requirements or be referred to an Employment Services Provider if not already connected to one. If the job seeker is no longer meeting the SEL activity requirement, the Service Officer needs to update the end date of the activity on the AEX screen prior to making the referral to employment services. See Employment Services Providers
• If the job seeker remains Centrelink managed, the system will determine if a new Job Plan needs to be negotiated
• Procedure ends here
• If this is the second or third consecutive reasonable excuse, go to Step 4

After providing 2 or 3 consecutive reasonable excuses (depending if the job seeker is under or over 55 years), the job seeker must choose another activity, as they can no longer meet their requirements through self-employment.

The Service Officer should:

• process the outstanding report using the Earnings and Reporting workflow
• end date the approved activity/ies on the AEX screen. The default of Job Search JSE should automatically apply as the approved activity
• make relevant updates to the REBS screen (where applicable)
• connect the job seeker with their Employment Services Provider (if not already connected with one). See Employment Services Providers
• If the job seeker was previously suspended from provider services due to undertaking self-employment activity, once the activity is ended, the provider will see that the job seeker is not meeting requirements through an approved activity and ensures they will engage the job seeker in a timely manner. The provider will update the Job Plan
• Advise the job seeker of the decision. Record decision and conversation with the job seeker on a DOC

To end or update an activity on the Activity and Exemption Summary (AEX) screen in Process Direct:

• Go to the AEX screen
• Select Edit on the activity which requires updating
• Update the End date select Save
• Complete the Receipt Date and Channel fields, select Save
• Select Assess and address any errors/warnings
• Select Assess again, then select Finish. Record details of the update on the Finalise screen
• Select Finalise to complete the transaction

Ending the activity on the AEX screen shows the provider that the job seeker is not meeting requirements through an approved activity and ensures the job seeker will be engaged by the provider in a timely manner. The job seeker's record will display as provider managed when DEWR sends advice that the job seeker has commenced or recommenced in Employment Provider Services.

Note: when the job seeker becomes provider managed, the Employment Services Provider is responsible for renegotiating the job seeker's Job Plan.

Procedure ends here.

Job seekers who fail to declare sufficient self-employment work hours to fully meeting their mutual obligation requirements, and have no reasonable excuse, may be able to choose another activity to fully meet their mutual obligation requirements and allow them to remain Centrelink managed. They cannot meet their obligations only through self-employment.

If the job seeker is no longer doing activities that fully meet mutual obligation requirements, they must immediately resume participation and attend all appointments with their Employment Services Provider, or be referred, if not already active with one. See Employment Services Providers.

Investigate other approved activities for the job seeker. If the job seeker does another activity or combination of activities that can be approved by Services Australia as fully meeting mutual obligation requirements:

• end date the previous approved activities on the AEX screen. The default of Jobsearch JSE should automatically apply as the approved activity
• make relevant update to REBS screen (where applicable)
• advise the job seeker of the decision. Record decision and conversation on a DOC
• connect the job seeker with an Employment Services Provider (if not already connected with one). The provider will update the Job Plan. See Employment Services Providers
• if the job seeker was previously suspended from provider’s services due to undertaking self-employment activity, once the activity is ended, the provider will see that the job seeker is not meeting requirements through an approved activity and ensures they will engage the job seeker in a timely manner. The provider will update the Job Plan

Procedure ends here.

Self-employment must equal 30 hours or more per fortnight for PCW 15-29 hrs per week, job seekers aged 55 and over and principal carers. Any self-employment within the bandwidth of a PCW/TRWC 0-14 hrs per week job seeker will fully meet requirements. If a principal carer is doing a combination of self-employment and study, or self-employment and other paid employment, the total hours between the 2 activities must be at least 30 hours per fortnight.

Advise the job seeker:

• they are fully meeting their mutual obligation requirements as they are doing an approved activity
• they do not need to report job search efforts when reporting to Services Australia
• they must still be available and willing to do other paid work if it is offered to them

To update in: Process Direct:

• Key START into the Super Key
• Select the Self Employment workflow from the Task Selector

Go to Step 8

Update the job seeker's business income and hours of employment. This should be done by using tax returns or profit and loss statements (where available), depending on how long the business has been running for.

See Code the Business Income and Assets details if required

Code the BUS screen update the following the details within the Self-Employment workflow:

• Event date
• Business Income and Asset details
• hours p/f (C/P) field
• any other details not recorded

Record details on a Note/DOC about how the income assessment was calculated.

Procedure ends here.

Job seekers who have Self-Employment (SEL) as a mutual obligation requirement, will be advised when these approved activities are about to expire so they have an option to confirm and extend the requirement, before the end date.

A ‘28 Days Prior to End Date Review’ is created on the Future Activity List (FAL) screen. An online task, letter or work item is created for a job seeker to be able to view and potentially extend their Approved Activity or Exemption. See Approved Activity Review Job Plan Contact.

If the activity type of self-employment is being reviewed, the Service Officer should check the job seeker still wants to continue with this activity.

If there are no changes:

• extend the end date of the approved activity/ies on the Activity and Exemption Summary (AEX) screen if needed. Refer to Step 4 in Table 2
• Review the information coded on the REBS screen and update if applicable
• record the conversation on a Note/DOC
• the system will determine when a new Job Plan needs to be negotiated
• the relevant sentence text will be included on all Job Plans negotiated on or after 1 July 2024. SEL activity 'I agree to undertake [number of hours] hours per fortnight of self-employment from [Start Date] to [End Date] and will provide my business income details to Centrelink'

If there are changes (e.g. job seeker has ceased self-employment, job seeker is no longer fully meeting the requirements of self-employment or the sufficient work test, or job seeker wants to change their activity type):

• end date the approved activity/ies on the AEX screen. The default of Jobsearch (JSE) should automatically apply as the approved activity
• connect or reconnect the job seeker with their Employment Services Provider (if not already active with one). See Employment Services Providers
• Review the information coded on the REBS screen and update if applicable
• record details on a Note/DOC

Note: when the job seeker becomes provider managed, the Employment Services Provider is responsible for renegotiating the Job Plan with the job seeker.

Procedure ends here.

Is the job seeker still meeting requirements through sufficient paid self-employment?

• Yes, check the job seeker's current activity on Activity and Exemption Summary (AEX) screen. If the activity has:
• expired, go to Step 3
• not expired, go to Step 4
• No:
• End date the approved activity/ies on the AEX screen. The default of Jobsearch (JSE) should automatically apply as the approved requirements
• Review the information coded on the REBS screen and update if applicable
• Connect the job seeker with their preferred Employment Services Provider (if not already connected with one). The Employment Services Provider is responsible for negotiating the Job Plan with the job seeker. See Employment Services Providers
• If the job seeker was previously suspended from provider's services due to undertaking self-employment activity, once the activity is ended, the provider will see that the job seeker is not meeting requirements through an approved activity and ensures they will engage the job seeker in a timely manner. The provider will update the Job Plan
• Record details in a Note/DOC
• Procedure ends here

• Extend the Self-Employment period on the Activity and Exemption Summary (AEX) screen
• If the job seeker has continued to meet their SEL activity requirements, record the:
• start date from the previous SEL activity end date + 1 day
• end date, 363 days from the new start date or the date SEL is expected to end (whichever is the earliest). Note: SEL can only be coded for a maximum period of 363 days therefore a new SEL line may need to be coded if the 363 day period has already been exceeded
• The system will display an Action Item on the Participation Summary screen if a new Job Plan is to be negotiated. Procedure ends here
• If the job seeker has resumed meeting their mutual obligation requirement through SEL after a break in self-employment since the expiry of the previous SEL activity, record the:
• start date from the date the job seeker recommenced self-employment of 30 hrs/fn
• end date 363 days from the new start date or the date SEL is expected to end (whichever is the earliest)

Procedure ends here

• Record a new period of SEL as appropriate (not exceeding 363 days).
• SEL can only be coded for a maximum period of 363 days, therefore a new SEL line may need to be coded on the AEX screen if the 363 day period has already been exceeded
• The system will display an Action Item on the Key Information screen of the Participation Summary screen if a new Job Plan is to be negotiated
• Procedure ends here