Paid Parental Leave – Eligibility and Employer Obligations

Thursday, December 8, 2011 by Wakeful Partners | No Comments | Taxonomy: ,

Australia’s first national paid parental leave scheme funded by the federal government started on 1st January 2011.  The scheme legally confirms parents rights to paid maternity leave after a child’s birth.

To find out more of the basics, please see the below summary.

Paid Maternity Leave – Key Facts

  • Paid at a national minimum wage $570 week (before tax)
  • Women has to have been earning less $150,000 per annum.
  • Can take up to 18 weeks paid leave (transferrable to their partners) within first year of child’s birth.
  • Full time, part time or casual workers, contractors and self employed persons maybe eligible provided they meet work test.
  • Work test means they must have worked for at least 1 day a week on average over 10 of last 13 months.
  • Claims can be lodged up to 3 months before the baby’s due date to ensure payments begin as soon as possible from the day the child is born.

Onus is on Employers

  • From 1st July 2011 employers will be responsible for providing paid parental leave to eligible employees.
  • They will only be responsible if the employee has worked in their business for 12 months or more.
  • Centrelink will transfer the required money to employers to pay the parental leave.
  • Employers then make payment under the normal pay cycle and withhold tax appropriately
  • Employers will not have to make superannuation contributions on the parental leave, nor will it increase payroll tax or workers compensation payments.
  • Employers can opt out of making payments if the employee has worked in their business less than 12 months.  Centrelink will thus make payments in this scenario.

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