The parental leave system in Australia consists of a combination of entitlements, including unpaid parental leave under the Fair Work Act (Cth) (FW Act), government funded paid parental leave and employer funded parental leave. Parental leave is often referred to as maternity leave, however, today's modern parental leave system provides entitlements for a much broader cohort than the birth mother.
Unpaid parental leave
The National Employment Standards (the NES) provides all employees (including casual employees) with the entitlement to unpaid parental leave, which consists of:
- birth and adoption related leave;
- flexible parental leave;
- pre-adoption leave; and
- special maternity leave.
Birth and adoption related unpaid parental leave
All employees are entitled to 12 months of unpaid parental leave if the leave is associated with:
- the birth of a child of the employee or the employee's spouse or de facto partner; or
- the adoption of a child under the age of 16 years.
Employees (other than casual employees) are entitled to take unpaid parental leave if they:
- have completed 12 months of continuous service before the date or expected day of the birth of a child, the date of adoption, or the date the leave is due to commence; and
- have or will have responsibility for the care of a child.
Casual employees are entitled to take unpaid parental leave if they:
- have been employed by their employer on a regular and systematic basis for at least 12 months;
- have a reasonable expectation of continuing employment for their employer on a regular and systematic basis, had it not been for the birth, expected birth, adoption or expected adoption of a child; and
- have or will have responsibility for the care of a child.
Employees who experience a stillbirth or the death of an infant during the first 24 months of life are also still entitled to access 12 months of unpaid parental leave entitlements under the NES provisions.
Notice when applying for unpaid parental leave
An employee must give their employer at least 10 weeks' notice, in writing, of their intent to take unpaid parental leave. If this is not practicable, then an employee must provide their employer with the notice as soon as practicable.
When notifying their employer that they are taking unpaid parental leave, an employee is required to advise their employer of the period or expected period, of the leave.
At least 4 weeks before their period of leave, an employee is required to:
- confirm the intended start and end dates of the leave; or
- advise the employer of any changes to the intended start and end dates of the leave.
Employer may seek evidence for unpaid parental leave
If an employee has provided notice to take parental leave, then an employer may ask the employee to provide evidence that would satisfy a reasonable person to demonstrate:
- for birth-related parental leave, the date or expected date of birth; or
- for adoption-related parental leave:
- the expected date of placement; and
- that the child is or will be under 16 years of age at the date of placement.
Taking of unpaid parental leave
Unpaid parental leave must be taken in a single continuous period and cannot be taken in separate periods. However, an employee may take paid leave, such as annual leave, at the same time they are on unpaid parental leave.
A pregnant employee may take unpaid parental leave:
- up to 6 weeks before the expected date of birth of the child; or
- earlier, if the employer and employee agree.
However, the leave cannot start later than the date of birth of the child.
For employees who are not pregnant (for example, a partner or spouse of the pregnant employee or an adopting parent), then their leave must start on the date of birth, for birth-related leave, or placement, for adoption-related leave, of a child.
If both parents intend to take unpaid parental leave, then each parent, whether they work for the same employer or not, is able to take a separate period of up to 12 months unpaid parental leave each. Both parents are able to take unpaid parental leave at the same time (which is known as concurrent leave) for a maximum of 8 weeks. However, the total combined leave, including the concurrent leave, between each parent cannot exceed 24 months.
If only one parent is taking unpaid parental leave, then they may make a request to their employer to extend their leave for a further period of up to 12 months immediately following the end of the available parental leave period. This request must be in writing and provided to the employer at least 4 weeks before the end of the available unpaid parental leave period.
Flexible unpaid parental leave
If an employee returns to work before their available 12-month unpaid parental leave period, they will be entitled to up to 30 days of flexible unpaid parental leave.
The flexible unpaid parental leave comes out of the employee's entitlement of 12 months of unpaid parental leave. Therefore, it is important to note that it is not an additional entitlement.
Some of the primary considerations related to the taking of flexible unpaid parental leave include the following:
- It is a maximum of 30 working days with a minimum period of one day at a time;
- Days can be taken consecutively or separately, as agreed between the employee and employer; and
- It must be taken before the child turns two, or for adopted children, within two years of the date of placement.
Notice when applying for flexible unpaid parental leave
An employee must give their employer notice that they intend to take unpaid flexible parental leave at the same time they give notice that they are taking unpaid birth or adoption parental leave.
If the employee is not taking a period of unpaid birth or adoption parental leave, then the employee must provide at least 10 weeks' notice before starting the flexible unpaid parental leave. However, the notice may be given at a later time if their employer agrees.
The notice must specify the total number of days of flexible unpaid parental leave that the employee intends to take in relation to the child.
If the employer agrees, the employee may:
- reduce the number of flexible days, including by reducing the number of days to zero; or
- increase the number of flexible days up to a maximum of 30 days.
The number of days of flexible unpaid leave that the employee takes must not be more than the number of flexible days notified to the employer.
An employee must also give their employer written notice of a day on which they will take flexible unpaid parental leave at least 4 weeks before that day or as soon as practicable (which may be a time after the leave has started). However, the employee may change the day on which they take flexible unpaid parental leave from a day that was specified in their notice, if their employer agrees.
Taking of flexible unpaid parental leave
Flexible parental leave can be used any time within the first 24 months from the date of birth or adoption of a child to whom the unpaid parental leave relates, as:
- a single continuous period of one or more days; or
- separate periods of one or more days each.
An employee may take flexible unpaid parental leave after taking unpaid parental leave provided that the total does not exceed 12 months.
Notably, an employee's entitlement to any unpaid parental leave, (that is, not flexible parental leave) ends on the first day the employee takes flexible unpaid parental leave. This means that if the employee is to take another type of unpaid parental leave under the parental leave provisions of the FW Act, the leave must be taken before the employee takes the flexible unpaid parental leave. If an employee is planning to take a period of continuous unpaid parental leave, then they should do so before they take flexible parental leave.
An employee can also take flexible parental leave on the same day their partner is on unpaid parental leave. However, as previously noted, the two employees can only take a total period of up to 8 weeks of unpaid parental leave at the same time.
If an employee gives birth to multiple babies (i.e. twins, triplets, etc.) or adopts more than one child at the same time, the employee will only be entitled to a maximum of 30 days unpaid flexible parental leave, rather than 30 days for each child.
Unpaid pre-adoption leave
Employees (including casual employees) are entitled to take 2 days of unpaid pre-adoption leave to attend any interviews or examinations required in order to obtain approval for the employee's adoption of a child.
However, an employee is not entitled to take a period of unpaid pre-adoption leave if:
- the employee could instead take some other form of leave, such as annual leave; and
- the employer directs the employee to take that other form of leave.
Notice when applying for pre-adoption leave
As with the notice required to be provided for special maternity leave (see below), an employee is required to provide their employer notice of their intent to take pre-adoption leave as soon as practicable, which may be a time after the leave has started. This notice also must specify the period, or expected period, of the leave.
Employer may seek evidence for pre-adoption leave
If an employee has provided notice to take unpaid pre-adoption leave, then an employer may ask the employee to provide evidence that would satisfy a reasonable person to demonstrate that they have to attend interviews or examinations to obtain approval for the adoption of a child.
The types of evidence that an employee can provide may include an appointment confirmation letter from an adoption agency.
An employee is not entitled to take unpaid pre-adoption leave unless they have provided their employer with notice and evidence if requested by the employer.
Unpaid special maternity leave
After 12 months continuous service, a female employee is entitled to a period of unpaid special maternity leave if she is not fit for work because:
- she has a pregnancy-related illness; or
- the pregnancy ends after a period of gestation of at least 12 weeks.
If the child is stillborn, the female employee may be entitled to the 12 months unpaid maternity leave.
If a female employee has an entitlement to paid personal/carer's leave, she may take that leave instead of taking unpaid special maternity leave.
Notice when applying for special maternity leave
An employee must give her employer notice of the taking of unpaid special maternity leave.
The notice must:
- be given to the employer as soon as practicable, which may be a time after the leave has started: and
- advise the employer of the period, or expected period, of the leave.
Employer may seek evidence for special maternity leave
An employer may ask the employee to provide evidence that would satisfy a reasonable person to demonstrate that the employee is taking special maternity leave because she has a pregnancy-related illness or the pregnancy ended. An employer may request that the evidence provided by the employee be a medical certificate.
An employee is not entitled to take unpaid special maternity leave unless they have provided their employer with notice and evidence if requested by the employer.
Paid Parental Leave
Some employees are also entitled to paid parental leave, either through the government funded Paid Parental Leave Scheme or their employer.
Australian Government Paid Parental Leave Scheme
Under the paid parental leave scheme, eligible employees are able to obtain paid parental leave from the Australian Federal Government for a newborn or recently adopted child.
There are two types of payments that are available under the scheme, which are:
- Parental Leave Pay; and
- Dad and Partner Pay.
Parental leave pay
Under the current scheme, Parental Leave Pay provides eligible employees (usually birth mothers or primary caregivers) with up to 18 weeks paid parental leave, which is paid at the national minimum wage rate at the time the leave is taken.
Parental Leave Pay includes:
- a continuous paid parental leave period of up to 12 weeks, which is 60 payable days; and
- 30 flexible paid parental leave days.
An employee is eligible to access Parental Leave Pay if they:
- are the primary caregiver of their newborn or adopted child;
- meet the income test. For the 2021/2022 financial year, the employee must have an individual adjusted taxable income of $156,647.00 or less prior to the date of birth or adoption or the date of the claim (whichever is earlier);
- meet the residency test from the day they become the child's primary caregiver until the end of their paid parental leave period. The residency test is met if the employee is an Australian citizen, the holder of a permanent visa, a special category visa holder or a certain temporary visa holder (for example, a partner provisional or temporary protection visa); and
- meet the work test. To meet the work test, a person must have:
- worked for at least 10 months (ie. 295 days) of the 13 months (i.e. 392 days) prior to the birth or adoption of their child; and
- worked a minimum of 330 hours, around one day a week in that 10-month period; and
- had no more than a 12-week gap between each work day in that 10-month period.
Dad and Partner Pay
Dad and Partner Pay provides eligible fathers or partners with up to two weeks pay at the rate of the national minimum wage.
An employee is eligible to access Dad and Partner Pay if they are:
- the child's biological father, adoptive parent of the child, partner of the birth mother or adoptive parent, or the person caring for a child of a surrogacy arrangement;
- meet the income, residency and work tests;
- not working during their Dad and Partner Pay period, unless
- need to work to comply with a court ordered summons;
- are a defence force or law enforcement officer working due to a compulsory recall to duty; or
- are a health professional, emergency services worker or other essential worker, responding to a state, territory or national emergency; and
- taking care of the child during the Dad and Partner Pay period.
Proposed changes to the Paid Parental Leave Scheme
On 30 November 2022, the Paid Parental Leave Amendments (Improvement for Families and Gender Equality) Bill 2022 (Cth) (the Bill) was introduced to Federal Parliament to reform the paid parental leave scheme to give families greater security and better support upon the birth or adoption of a child.
The key changes the Bill proposes to make to the paid parental leave scheme include:
- increasing the paid parental leave entitlement from 18 weeks to 20 weeks from 1 July 2023;
- combining the Paid Parental Pay and Dad and Partner Pay into a single 20 week payment. This means that either one parent can take the full 20 week entitlement or the couple can share the entitlement between them;
- reserving two weeks of the scheme for each parent to encourage fathers and partners to access paid parental leave, which will be on a 'use it or lose it basis';
- increasing flexibility for parents to take the payment in multiple blocks, as small as a day at a time, within two years of the birth or adoption, and remove the requirement to not return to work in order to be eligible;
- introducing a $350,000 family income limit, under which families can be assessed if they do not meet the individual income test; and
- expanding eligibility to allow eligible fathers and partners to receive parental leave pay regardless of whether the birth parent meets the income test, residency requirements or is serving a newly arrived resident's waiting period.
The changes to the Paid Parental Leave Scheme will take effect from 1 July 2023, provided the Bill is passed by Parliament by March 2023.
The Federal Government announced on 1 December 2022 that they will introduce further legislation to progressively increase the Paid Parental Leave Scheme from July 2024, until it reaches 26 weeks in 2026.
Employer funded paid parental leave
Employers may also provide its employees with an entitlement to paid parental leave, either through an enterprise agreement or employment contract. The amount of paid parental leave an employee is entitled to depends on the terms of the relevant enterprise agreement or employment contract.
Other entitlements under the Fair Work Act
Under the NES parental leave provisions, employees are also entitled to a range of other benefits, including:
- for pregnant employees, to be moved to a safe job because if it isn't safe for them to do their usual job because of their pregnancy, whether they are entitled to take unpaid leave or not;
- paid leave if there is no safe job for a pregnant employee to be transferred to, for employees who are entitled to take unpaid parental leave;
- unpaid leave if there is no safe job for a pregnant employee to be transferred to, for employees who are not entitled to take unpaid parental leave; and
- a return to work guarantee upon the unpaid parental leave ending.
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.