The Fair Work Act 2009 has significantly amended the Federal
Government's previous approach to an employee's entitlement
to take leave upon the birth of a child. This reflects the changes
in Australian society since the introduction of the first
legislated parental leave entitlements in 1979. The
'normal' family unit no longer consists of dad going to
work and mum staying at home to look after the children and so the
terms 'maternity leave' and 'paternity leave' no
longer exist in Australian legislation. A parent's entitlement
to take leave upon the birth, or adoption, of a child is now
referred to as 'parental leave' and is equally available to
mum, dad, step-parents and adoptive parents whether they be
married, de facto, same-sex or otherwise.
Following on from these changes, the Paid Parental Leave Bill
2010 was passed by the Federal Parliament in July 2010, introducing
Australia's first government-funded national paid parental
leave scheme. This continues the government's recent focus on
the 'modern family unit', recognising the changing roles of
The new government-funded scheme
Paid parental leave will be available to the 'primary
care-giver' of a child born or adopted after 1 January 2011. It
is payable for up to 18 weeks at the national minimum wage,
currently $569.70 gross per week, within the first 12 months after
the birth or placement of an adopted child. The parent must be an
Australian resident, have earned $150,000 or less in the previous
financial year and must meet the Paid Parental Leave Work Test.
This test requires that the parent worked continuously for at least
10 of the 13 months prior to the birth or adoption of the child and
worked for at least 330 hours in that period with no more than an
eight-week gap between two working days.
Paid parental leave entitlements will cease if the parent
returns to work; however, the parent can participate in workplace
activities, and receive wages, for up to 10 days without affecting
their entitlement. The entitlement can also be transferred from one
parent to another.
While the Federal Government will fund this scheme, after 1 July
2011 the administration of payments will generally be by the
employer. Employers should review the 'Business Requirement
Statement' provided by the Family Assistance Office to ensure
they are able to meet the government requirements for administering
If a person has been employed for less than 12 months, is
entitled to receive less than eight weeks of Parental Leave Pay or
is not employed, payments will be made by the Family Assistance
The government-funded 'baby bonus' will also continue to
be available; however, only one option will be payable for each
child. Employees eligible for the paid parental leave scheme can
choose which benefits they wish to receive.
Paid leave by employer will usually continue
In most cases the entitlement to receive paid parental leave
through the government scheme should not affect paid parental leave
provided by an employer. An employer cannot withdraw an entitlement
to employer-funded paid parental leave available through an
industrial instrument or employment contract during the life of
that instrument or contract. However, whether a policy of paid
parental leave (as found in an employer's HR or staff policies)
is an employee entitlement or can be withdrawn unilaterally would
depend on the wording of individual policy documents and practices
within that employer. These situations would need careful
consideration on the individual facts, and legal advice should be
obtained wherever there is uncertainty.
An employee's entitlement to receive paid parental leave
under the Paid Parental Leave Act 2010 should not be confused with
an employee's entitlement to take parental leave pursuant to
the Fair Work Act 2009. The qualifying requirements are quite
different and being eligible for one does not necessarily mean an
employee is eligible for both.
Carroll & O'Dea has produced a Parental Leave Guide to
help employers and their employees track their way through these
complex changes. You should have received your free copy of the
Guide with this month's edition of Human Capital. Please
contact Carroll & O'Dea if the Guide was not received with
this magazine, or if you would like more copies of the Guide.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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