Top myths about the Paid Parental Leave scheme for employers

As an employer there are some common myths you might come across about the scheme.

The Australian Taxation Office or Fair Work Australia 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.

Businesses are funding Parental Leave Pay

The Australian Government funds Parental Leave Pay.

In most cases, employers are required to provide their long term eligible employees with Parental Leave Pay, once they get the funds from us. You will need to provide it to your employee through their normal pay cycle.

Small businesses are exempt. You need a certain number of staff for your business to qualify

The Paid Parental Leave scheme applies to all employers, no matter the size of your business or the number of staff. Even if you have just 1 employee.

Employers need to work out if their employees are eligible

First, your employee needs to lodge a claim with us. It’s then our job to assess whether your employee is eligible for Parental Leave Pay. We’ll then contact your business if you’re required to provide Parental Leave Pay to your employee.

The Paid Parental Leave scheme applies to full-time employees only

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 Paid Parental Leave 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. And, 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.

Employees can take Parental Leave Pay in 2 or more blocks

Your employees must take Parental Leave Pay in a continuous block of up to 18 weeks.

Your employee can take it at the same time as any type of paid or unpaid leave. For instance, taking 4 weeks of annual leave, 6 weeks of paid maternity leave and 8 weeks of unpaid parental leave. They can do this while they’re receiving Parental Leave Pay.

The Paid Parental Leave payments employers receive, align with their 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.

Employers can’t register for the scheme until their employee makes a claim

You don’t need to wait—you can prepare your business now. You can register for the scheme any time on our website.

If you choose not to use online services, or don’t have access to the internet, register by calling. Call us on the Paid Parental Leave Scheme for employers line.

To find out more about your role in the Paid Parental Leave scheme

For more information about working entitlements and workplace obligations:

Page last updated: 6 April 2020