Australia introduced its first Paid Parental Leave Scheme (“the Scheme”) in January 2011. The scheme recognises the importance of an employee’s parental and family responsibilities by providing eligible working parents with government funded pay to care for a newborn or recently adopted child.
Subject to meeting the Paid Parental Leave Pay eligibility requirements, working parents can receive parental leave pay when they take unpaid parental leave.
What is paid parental leave?
Paid parental leave in Australia is available to full-time, part-time and casual employees and consists of two payments:
Parental Leave Pay
Dad and Partner Pay.
Parental Leave Pay usually applies to birth mothers while Dad and Partner pay applies to working dads or partners (including same-sex partners).
Paid parental leave eligibility: what are you entitled to?
To be eligible for parental leave pay, you must:
be the birth mother of a newborn child or the adoptive parent of a child;
be on leave or not working from the date of your child’s birth or adoption until the end of your paid parental leave period;
have registered or applied to register the birth of a newborn;
have an individual taxable income of $150,000.00 or less;
have worked for both 10 of the 13 months before the birth or adoption of your child and a minimum of 330 hours, around one day a week, in that ten-month period;
You are not eligible to receive parental leave pay if you do not meet the eligibility criteria. Furthermore, if your child’s date of birth or adoption is before 1 July, 2020 and you return to work, then you cannot receive parental leave pay.
Parental leave pay is not available to a foster carer or a person who is caring for a child on a temporary basis.
How much is paid parental leave?
Parental Leave Pay
An eligible employee can access up to 18 weeks of government-funded parental leave pay at the National Minimum Wage (currently $753.80 per week). Payments generally start from the date of birth or adoption, although can start at a later date. From 1 July, 2020, employees can claim parental leave pay in two periods. The first period is a fixed period of twelve weeks which must be taken in one continuous block. The second period is a flexible period which allows the employee to take up to 6 weeks of parental leave pay upon returning to work on a part-time basis. For example, if the employer agrees, an employee who was working full time (5 days per week) prior to commencing their parental leave can return to work on a part-time basis (3 days per week). The employee claims 2 days per week of parental leave pay, up to a maximum of thirty days. This equates to 15 weeks of paid parental leave at 2 days per week.
Dad and Partner Pay
An eligible Dad or Partner is entitled to receive up to 2-weeks’ pay at the National Minimum Wage, provided the Dad or Partner is on leave. This pay may be claimed at any time in the first year after the child’s birth or adoption. If Dad or Partner is entitled to receive Parental Leave Pay, then the total of both Parental Leave Pay and Dad and Partner Pay cannot exceed 18 weeks.
Can parental leave pay be paid directly to you?
Generally, the employer pays employees there Paid Parental Leave pay in their normal pay cycle. For this to occur, employees will need to:
have worked for the employer for at least one year before the birth or adoption of the child;
stay employed until the end of the Paid Parental Leave period;
be eligible to receive at least eight weeks of Parental Leave Pay.
To make Paid Parental Leave payments, the employer must be Australian-based.
If the above-mentioned criteria are not met, then employees may receive payment directly from Centrelink. Further information about claiming and payment of Parental Leave Pay can be found on the Services Australia website.
Can you work while on paid parental leave?
Employees cannot work while they are receiving Paid Parental Leave pay. If an employee returns to work on a part-time basis after the initial parental leave period (first 12 weeks), they must ensure that any Parental Leave pay claimed under the second flexible parental leave period (6 weeks) is for days when the employee does not work.
Can you get paid parental leave and the Newborn Upfront Payment?
Employees in receipt of Paid Parental Leave Pay are not eligible to receive the Newborn Upfront Payment or the Newborn Supplement. Employees in receipt of Dad and Partner Pay may still be eligible for these payments. I hope this has been of interest to you. If you have questions or require assistance, please don’t hesitate to contact our Employment Team.