Australia expands unpaid parent leave benefits

Beginning July 1, 2023, Australia will expand unpaid parent leave benefits. The current entitlement of 18 weeks paid parental leave pay will be combined with the current Dad and Partner Pay entitlement of 2 weeks’ pay. This means partnered couples can claim up to 20 weeks of paid parental leave between them. Parents who are single at the time of their claim can access the full 20 weeks.

These changes affect employees whose baby is born or placed in their care on or after July 1, 2023.

Other changes include:

• Allowing partnered employees to claim a maximum of 20 weeks’ pay between them, with each partner taking at least 2 weeks (except in some circumstances)
• Introducing a $350,000 family income limit (indexed annually from July 1, 2024) for claiming paid parental leave pay
• Expanding the eligibility rules for fathers or partners to claim paid parental leave pay
• Making the whole payment flexible so that eligible employees can claim it in multiple blocks until the child turns 2
• Removing the requirement to return to work to be eligible for the entitlement

Parental Leave Pay refresher

Parental Leave Pay is an Australian government payment for up to 18 weeks so an employee can look after a new child. It is paid at the national minimum wage rate.

A person can receive this payment if they are:

• The birth mother of a newborn child
• The adoptive parent of a child

The government usually pays the employer first, who then pays the employee. However, employees can elect to receive the payment directly from the government. Employees can get the payments before, after, or at the same time as other leave entitlements, such as annual and long service leave.

Dad and Partner Pay

Working fathers and partners (including same-sex partners) may be eligible for 2 weeks of leave paid at the minimum wage. This leave is paid by the Australian government directly to the employee. It is paid in one block. Some employers top up Dad and Partner Pay, so it is equivalent to the employee’s normal wage.

Employer-funded paid parental leave

Depending on an employee’s award, agreement, contract, or workplace policy, they may also be entitled to paid parental leave from their employer. Employees can receive both Parental Leave Pay from the government and paid parental leave from their employer. The amount paid depends on arrangements with the employer.

 

CA Financial, Asinta’s employee benefits consulting Partner in Australia, provided this information about Australia’s expansion of unpaid parental leave benefits.