Important Information: Paid Parental Leave - Australia

1st of Jun 2011

Australia's first national Paid Parental Leave scheme started on 1 January 2011.The scheme is fully funded by the Australian Government and provides eligible working parents with 18 weeks of Parental Leave Pay at the National Minimum Wage, currently $570 a week before tax.

Taking time away from work for a new baby is a common part of working life. The Paid Parental Leave scheme will help parents spend more time at home with a new baby, and help employers keep skilled and valuable staff.

What does the Paid Parental Leave scheme mean for employers?

Your role is to provide Parental Leave Pay to your eligible long-term employees.

This role is being phased in for children born or adopted during the first six months of 2011. During this time, if you and your employee agree, you can provide Parental Leave Pay to your eligible employees.

From 1 July 2011, you must provide Parental Leave Pay to an eligible employee who:

  • has a child born or adopted from 1 July 2011
  • will have been your employee for 12 months or more prior to the expected date of birth or adoption
  • will be your employee for their Paid Parental Leave period, and
  • is an Australian-based employee, and
  • is expected to receive eight weeks or more of Parental Leave Pay.

The Paid Parental Leave scheme does not provide eligible employees with a new entitlement to leave.

The existing minimum entitlement to 12 months unpaid parental leave for long-term employees, in the National Employment Standards under the Fair Work Act 2009, is unchanged.

As of 1 July 2011, employers will have to pay eligible employees from funds received via Centrelink's Family Assistance Office.

Employer-funded paid parental leave

Many employers also provide employees a period of paid parental leave through their enterprise agreements, contracts of employment or workplace policies. Such incentives can help businesses attract and retain talented staff.

The introduction of the Australian Government's Paid Parental Leave scheme is not intended to replace existing entitlements to employer-funded paid parental leave, and having an existing entitlement to employer-funded paid parental leave does not affect an employee's potential eligibility for the Australian Government's Paid Parental Leave scheme. If an employer currently provides paid parental leave through an industrial agreement (such as an enterprise agreement), the entitlements will continue as long as the agreement applies.

A 'Best Practice Guide' from the Fair Work Ombudsman is available here; or if you require any policies to reflect these and other changes, contact us at Business Savvy.

Note: The PPL Amendment Bill to maintain Centrelink's role of administering paid parental leave payments was knocked back. As a result from the 1st of July 2011, employers will have to pay eligible employees from funds received via Centrelink's Family Assistance Office.

Contact us for more information:

Phone: (02) 9555 1708
Fax: (02) 9555 1692
Email: info@businesssavvy.com.au