New Paid Parental Leave Legislation: What Employers Need to Know

Key Changes to Australia’s Paid Parental Leave Policy

The changes to Australia’s paid parental leave policy take effect from July 2023. One key change is a single paid parental leave scheme with a flexible 20-week entitlement for working parents.

Other changes include:

• Multiple blocks of leave: Parents will be able to access the entitlement in multiple blocks with periods of work in between to grant them further flexibility on how they take the leave.
• No requirement for primary claimant: The legislation also scraps the requirement that the primary PPL claimants must be the birth parent, making it easier for families to decide who will claim the entitlements first.
• Expanded entitlements: The amendments also expand the PPL entitlements granted to single parents to 20 weeks, up from the current 18.
• New family income test: The new family income test of $350,000 per annum will also expand the eligibility of the PPL policy to nearly 3,000 additional parents.

New Paid Parental Leave Implications for Employers

You will need to take note of these changes and ensure your business is complying with the new legislation. Key things to keep in mind:

• Flexibility for Employees. With the new legislation, parents will be able to take parental leave in multiple blocks, which will provide more flexibility for employees. You will need to ensure you have processes in place to manage the leave.
• Non-Birth Parents. The legislation removes the requirement that the primary PPL claimants must be the birth parent, which means that non-birth parents and fathers will now be eligible to claim the entitlements first. Employers will need to ensure that they have systems in place to manage the change and ensure that non-birth parents are treated fairly.
• Expanded Entitlements. With the entitlements expanded to 20 weeks for single parents, from the current 18 weeks, employers will need to be prepared to accommodate of the additional time that some employees may take off work. This may require employers to adjust their staffing arrangements and ensure that they have processes in place to manage the leave.
• New Family Income Test. The new family income test of $350,000 per annual will expand the eligibility of the PPL policy to nearly 3,000 additional parents. This means that employers will need to adjust their processes to manage the additional employees who are now eligible for parental leave.

Preparing for the Paid Parental Leave Changes

One of the first steps you as a manager need to take is to educate yourself on the new legislation and perhaps consider  contacting legal and/or HR experts – e.g. our team here at Akyra Strategy & Development. The Australian government is also offering resources via the Department of Social Services website, which provides a detailed explanation of the new rules.

You should also evaluate your current payroll and HR systems to ensure they are prepared to accommodate the new rules. This could involve updating software or processes to account for the flexible 20-week entitlement, and any changes to eligibility requirements or payment amounts.

Communication with your workforce is also crucial. You should inform your employees of the upcoming changes, including any updated policies, procedures and entitlements. Employees need to know their rights and responsibilities under the new legislation, and how to access and utilise the new entitlements.

Akyra’s Key Takeaways

The new parental leave legislation in Australia introduces several changes that will affect business and it is crucial for organisations to be aware of the changes and prepare accordingly. Here are Akyra’s key takeaways:

1. Be prepared: Business need to ensure they are complying with the new legislation and have processes in place to manage the leave.

2. Educate yourself: Consult with legal and HR experts and take advantage of the resources available from government websites to understand the new legislation.

3. Review your systems: Evaluate your current payroll and HR systems to ensure they are prepared to accommodate the new rules.

4. Communicate with employees: Inform your employees of the upcoming changes, including any organisational updated policies, procedures, and entitlements.

By implementing these key takeaways, employers can support working parents and create a more productive and engaged workforce.