On 24 February 2011, the Paid Parental Leave (Reduction of
Compliance Burden for Employers) Amendment Bill 2010 was voted down
by Parliament. This Bill sought to reverse the requirement under
the Paid Parental Leave Act 2010 (Cth) (PPL Act) that
employers administer Paid Parental Leave (PPL) scheme payments on
behalf of the government by passing on the PPL instalments from the
government to an eligible employee.
What this means for employers
Considering that the employer's role in the government
funded PPL scheme is cemented, it is important for employers to
know their obligations under the PPL Act and be ready for 1 July
2011, when it becomes mandatory for them to pay PPL instalments to
Obligations of employers include:
responding to a notice of employer determination from the
Secretary within 14 days of the date of the notice
deducting the required PAYG tax from instalments
notifying the Secretary if an instalment has not been paid to
an employee that was required to be paid
notifying the Secretary if the employer has not been paid the
PPL funding amount as agreed
notifying the Secretary if the PPL funding amounts received are
more than the instalments payable to an employee.
It will be necessary for employers to keep close track of PPL
instalments coming in from the government and the passing on of
those instalments to employees.
Employers should now also consider and implement any changes
that may be required to made to their payroll and administrative
systems to ensure that the systems are ready to accommodate the
receipt and passing on of PPL instalments.
Implications of the Bill being defeated
Enterprise bargaining negotiations between unions and employers
may now include requests by the union for further PPL entitlements
We expect that unions will use workplace bargaining to seek
further advances on the government-funded PPL scheme for employees.
Unions will likely push for entitlements such as full income
replacement, which would involve an employer 'topping up'
the government-funded minimum wage to the employee's actual
wage, increasing the length of paid parental leave to up to 26
weeks through an employer contribution and ensuring employees
continue to receive superannuation contributions whilst on PPL.
DLA Phillips Fox is one of the largest legal firms in
Australasia and a member of DLA Piper Group, an alliance of
independent legal practices. It is a separate and distinct legal
entity. For more information visit
This publication is intended as a first point of reference and
should not be relied on as a substitute for professional advice.
Specialist legal advice should always be sought in relation to any
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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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