Myths about the Paid Parental Leave scheme for employers

We address myths you might have heard about your role in the scheme as an employer.

Myths about who is responsible

The Australian Taxation Office is responsible for the Paid Parental Leave scheme

Services Australia is responsible for managing the Paid Parental Leave scheme. We also have a Paid Parental Leave Scheme for employers line to help answer any of your questions.

Employers fund Parental Leave Pay

The Australian Government funds Parental Leave Pay.

In most cases, employers must provide their long term eligible employees with Parental Leave Pay. This is after they get the funds from us. You'll need to provide it to your employee through their normal pay cycle.

Employers need to work out if an employee is eligible

First, your employee needs to lodge a claim with us. It’s then our job to work out if they’re eligible for Parental Leave Pay. We’ll tell you if you’re required to provide Parental Leave Pay to your employee.

Myths about who it’s for

Small businesses or those with a small number of staff are exempt from participating in the scheme

Small businesses aren’t exempt. The Paid Parental Leave scheme applies to all employers. The size of your business or the number of staff you have doesn’t matter. Even if you have just 1 employee, you may still need to take part.

The scheme only applies to full-time employees

Full-time, part-time, casual, seasonal, contract and self-employed workers may be eligible for Parental Leave Pay.

You’re required to provide Parental Leave Pay to an eligible employee who meets all of the following:

  • has a newborn or recently adopted child
  • has worked for you for at least 12 months before the expected date of birth or adoption
  • will be your employee until at least the end of their Paid Parental Leave period
  • is Australian based
  • expects to receive at least 8 weeks of Parental Leave Pay.

The scheme doesn’t apply to an employee who stopped working because of extreme circumstances

Employees may be eligible for Paid Parental Leave if they’ve stopped working due to special circumstances.

This is if any of the following affected their ability to work during the work test period:

  • family and domestic violence
  • a serious medical condition, for either the employee or an immediate family member they care for
  • a natural disaster declared by the Commonwealth or a state or territory.

These changes apply from 4 September 2021.

Other common myths

The scheme changes employees’ leave entitlements

Parental Leave Pay doesn’t change any of your employees’ existing leave entitlements or give them a new entitlement to leave. Because it’s a payment and not an entitlement to leave it has no effect on your employees’ leave accrual.

Your employee may get up to 12 months of unpaid parental leave. This is if they have worked with you for 12 months or more before their child’s birth or adoption. They can also request an additional 12 months unpaid leave on top of this. This applies under the Fair Work Act 2009.

If you currently provide paid maternity or parental leave through an industrial agreement or law, you can’t withdraw that entitlement. This applies for the life of the agreement or law.

An employee can’t get Parental Leave Pay and paid leave at the same time

Your employee can get Parental Leave Pay at the same time as any type of paid or unpaid leave. This includes maternity leave, annual leave, sick leave and parental leave.

For instance, they may take all of the following while they’re getting Parental Leave Pay:

  • 4 weeks of annual leave
  • 6 weeks of paid maternity leave
  • 8 weeks of unpaid parental leave.

I have to provide Parental Leave Pay in multiple blocks

Employers will only provide Parental Leave Pay in a single continuous block. This block will be between 8 and 18 weeks, depending on your employee’s circumstances.

Your employee may choose to connect some Flexible Paid Parental Leave days to their Paid Parental Leave period. The block you provide, will include these days.

Parental Leave Pay will always be 18 weeks

Parental Leave Pay can be up to 18 weeks pay. How long you have to provide Parental Leave Pay will be between 8 and 18 weeks. This depends on your employee’s circumstances.

We’ll tell you how long you need to provide Parental Leave Pay to your employee.

Your employee may get Flexible Paid Parental Leave days up to 2 years after their child’s birth or adoption.

However, you’ll only pay any days they connected to their Paid Parental Leave period. These will always be within the first year of their child’s birth or adoption. We’ll provide the rest to them.

The payments I get will align with my employee’s pay cycle

You’ll choose how you want to get the funds from us when registering for the scheme. The options are fortnightly or 6 weekly instalments.

We’ll ask about your employee’s pay cycle and pay frequency so we can make sure you have enough funds in advance. This is to enable you to provide Parental Leave Pay to your employee in line with their pay cycle.

I have to wait for my employee to claim before I can register for the scheme

You don’t need to wait, you can register for the scheme at any time. The easiest way to register for the scheme is online.

You can also register by calling us on the Paid Parental Leave Scheme for employers line.

More about your role

To find out more about the Paid Parental Leave scheme you can:

For more information about working entitlements and workplace obligations:

Page last updated: 10 December 2021