Paid Parental Leave Scheme

by | Oct 25, 2010 | Employers Tips

The Paid Parental Leave scheme starts on 1 January 2011. It is government funded and paid at the National Minimum Wage, which is currently $570.00 per week before tax. Paid up to 18 weeks and can be taken anytime within the first years after birth.

Parental leave

If you employ staff your role in providing Parental Leave Pay will be voluntary until 30 June 2011.

However, from 1 July 2011 you will be responsible for providing Parental Leave Pay to your eligible employees who have a child from 1 July 2011 and have worked in your business for 12 months or more and are expecting to receive more than eight weeks Parental Leave Pay.

From my understanding even though the scheme is government funded, you will require to pay your employee. However, you will be reimbursed.

The administrator for this scheme is the Centrelink, please check their website for further information on your responsibilities.

Employer Obligations:

To ensure you meet your obligations to provide Parental Leave Pay to your eligible employees, follow these points as outlined on the Family Assistance Office website:

  1. Provide your bank account details, employee’s usual pay cycle and pay cut off details to us to ensure you receive Paid Parental Leave funds.
  2. Provide Parental Leave Pay to your employee for their Paid Parental Leave period.
  3. Provide Parental Leave Pay as part of your employee’s usual pay cycle.
  4. Withhold tax from Parental Leave Pay under the usual PAYG withholding arrangements. You will need to include Parental Leave Pay in the total amounts on the employee’s annual or part-year payment summary (statements given to the employee for tax purposes).
  5. Provide a record of Parental Leave Pay for your employee (usually a payslip).
  6. Keep written financial records of receipt of Paid Parental Leave funds received from us and of the Parental Leave Pay provided to your employee.Parental leave 2

You should notify the Family Assistance Office:

  • If and when your employee returns to work before or during their Paid Parental Leave period
  • If and when your employee resigns from your business
  • If you change your bank account details or your employee’s pay cycle,
  • If you receive an incorrect amount of Paid Parental Leave funds or if you are unable to provide Parental Leave Pay to your employee.

You will need to return any unpaid Paid Parental Leave funds.

  • if your business ceasing to trade
  • selling your business, or
  • transferring ownership or merging with another business.

The Paid Parental Leave scheme does not provide an entitlement to leave. Parental Leave Pay is designed to complement existing leave entitlements, for example, the unpaid parental leave provision of the National Employment Standards under the Fair Work Act 2009.

Under the Fair Work Act 2009 if an employee has been employed by your business for 12 months or more, they may be entitled to access up to 12 months unpaid parental leave associated with the birth or adoption of a child. Where families prefer one parent to take a longer period of leave, that employee has the right to request up to an additional 12 months of unpaid parental leave.

Author: Vlasta Eriksson

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