Businesses enrolled in the government's JobKeeper scheme who do not pass on the full $1500 payment to employees can expect to feel the full weight of the law, said Prime Minister Scott Morrison.

Key points: There are reports of employers asking for a portion of the payment

There are reports of employers asking for a portion of the payment The Government says the ATO will be auditing businesses

The Government says the ATO will be auditing businesses Penalties for breaking the law include fines and jail time

More than 850,000 businesses have put their hand up to join the Federal Government's $130 billion JobKeeper scheme, with payments to begin next month.

But even before the money starts to flow, reports have surfaced of businesses allegedly trying to skim the payment from their employees.

The Federal Member for the South Australian seat of Mayo, Centre Alliance's Rebekha Sharkie, said she was contacted by a woman who was offered her job back — but only if she agreed to give her employer a portion of the $1500 payment.

"She felt incredibly uncomfortable and refused that offer put to her by that employer," Ms Sharkie said.

"[She] unfortunately received continuing contact from that employer really trying to guilt her into that situation, which is completely unacceptable."

Ms Sharkie is calling for the government to establish a national hotline where people can report similar instances.

"To be a deterrent to any potential employer who somehow thinks they can game the system," she said.

"We already know there's a power imbalance between employers and employees and I would expect every employer to do the right thing."

Loading

When asked about the reports of employers trying to skim the payment, Prime Minister Scott Morrison described the actions as "appalling".

"That sort of behaviour where it occurs by employers is disgraceful and it's illegal," he said.

"They should be reported to the police and the Australian Tax Office, to make sure that can be followed up — it's not on."

Employment Minister Michaelia Cash said the penalty for businesses who tried to rort the system would be at the discretion of the ATO Commissioner, but the Tax Office would be conducting audits of businesses signed up.

In its latest fact sheet, the Treasury Department made it clear there would be zero tolerance for employers or employees who did the wrong thing.

"An entity that does not comply with its obligations in relation to the JobKeeper Payment is also potentially liable for a wider range of significant administrative and criminal sanctions under the tax law and general criminal law," the fact sheet says.

"These penalties will not affect entities that act honestly and with reasonable care.

"However, entities that seek to abuse the scheme, especially those that seek to engage in fraud, will face penalties commensurate with the seriousness of their conduct."

The Government has outlined the penalties for employers or employees if they break the law. ( Supplied: Treasury Department )

Uncertainty remains over payment gaps

Another lingering question for the government is how businesses are expected to pay their workers in advance when they are not making any money themselves — especially if they have been unsuccessful getting help from the bank.

To be eligible for the program, employers must pay their staff who were employed at March 1, for the fortnight starting from March 30 — which is when the government payments are backdated to — even though the JobKeeper money does not begin to flow until May.

The ABC has asked the government why the payments are not backdated to the beginning of March.

It also remains unclear whether businesses must re-employ all staff members they stood down or can pick and choose who they want to keep on the books.

For employees of businesses that could receive JobKeeper, but have not indicated they will apply, unfortunately there is not much the government can do.

Speaking to Sydney radio station 2GB, Treasurer Josh Frydenberg said he "encouraged" any business who was eligible to sign up.

"That maintains that formal connection between the employer and employee," he said.

"And obviously would provide a significant amount of money to those staff to help them through this difficult period."