Parental Leave Part 2

Parental Leave Part 2: Paid Parental Leave

This blog post is the second of three posts on parental leave entitlements. It addresses government and employer-funded paid parental leave.

Government-funded Parental Leave Pay

There is government-funded parental leave pay and dad and partner pay available to eligible employees. The payment rate is the National Minimum Wage, which is currently set at $657.00 per week before tax.

Paid parental leave operates concurrently with unpaid parental leave for employees who are eligible for both.

In addition to government-funded parental leave pay, employers may choose to have their own paid parental leave scheme. Employees who are offered paid parental leave by their employer are still able to claim government-funded parental leave pay.

Eligibility

Government-funded Parental Leave Pay is available to some employees who are the primary carer of a newborn or adopted child. The payments are made for up to 18 weeks and are paid first to the employer who then passes them onto the employee. The payments can be made concurrently with (or before or after) other payments such as annual leave.

The eligibility requirements for Parental Leave pay are:

  • The employee is the primary carer of a newborn or recently adopted child (the ‘primary carer of a newborn’ is usually the mother because they meet most of the child’s physical needs).
  • The employee meets the work test which means:
    o That they have worked for at least 10 of the 13 months prior to the birth or adoption of the child; and
    o Have accrued at least 330 hours of work in that time; and
    o There has not been a gap of more than eight weeks between work days.
    o It does not matter if the employee has recently changed employers
  • The employee meets the residence requirements.
  • The employee’s adjusted taxable income is no more than $150,000 per financial year.
  • The employee will not be working (on leave or otherwise) from the time they become the primary carer until the end of the Parental Leave Pay period.

Exceptional circumstances for paid parental leave

If the primary carer is unable to care for the child, another person may claim the Parental Leave Pay if they expect to be taking care of the child for at least 26 weeks and they begin taking primary care of the child within 52 weeks of the child’s adoption or birth. The claim can only be made in exceptional circumstances, such as where the primary carer is very ill.

Paid parental leave for dads and partners

Employees who are dads or partners may be eligible for two weeks of government-funded parental leave at the national minimum wage. Unlike Parental Leave Pay, Dad and Partner Pay is paid directly to the employee. The payments don’t discriminate between heterosexual and same sex parents.

Eligibility

The eligibility requirements for Dad and Partner Pay are:

  • The employee is either the
    o Biological father of the child,
    o Partner or spouse of the biological mother of the child,
    o Adopting parent,
    o Partner of the adopting parent,
    o Surrogate parent, or
    o Partner of the surrogate parent.
  • The employee meets the residence requirement.
  • The employee looks after the newborn or adopted child.
  • The employee’s adjusted taxable income is no more than $150,000 per financial year.
  • The employee meets the work test, which means:
    o That they have worked for at least 10 of the 13 months prior to the period of Dad or Partner Pay; and
    o Have accrued at least 330 hours of work in that time; and
    o There has not been a gap of more than eight weeks between work days.
  • The employee will not be working (on leave or otherwise) during the period of Dad and Partner Pay.

Recordkeeping and pay slips

Employers need to keep detailed records of the government-funded parental leave payments they receive and pay out to employees.

Employers also need to give a pay slip to their employee for each parental leave payment they pass on that states that the payments are being made under the government-funded scheme.

Paid parental leave from employers

Employers may provide their own paid parental leave scheme. It can be set out in a registered agreement, employment contract or workplace policy. Employers are free to determine what entitlements are provided by their own scheme.

Employer-funded payments do not affect government-funded payments.

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