Parental leave lets employees take time away from work for the birth or adoption of a child. The term ‘parental leave’ can include:

Under the Fair Work Act, employees (including regular casual employees) who have worked with their employer for at least 12 months can take unpaid parental leave when they or their partner are to give birth or adopt a child.

The Australian government provides Parental Leave Pay (PLP) for working parents at the national minimum wage for a maximum period of 18 weeks. This scheme gives eligible employees a payment during their leave, it doesn’t extend the period of leave they can take.

Developing a parental leave policy 

Employers can provide paid parental leave in enterprise or other registered agreements, employment contracts, and workplace policies. The amount of leave and pay entitlements depends on the relevant agreement, contract or policy.

Employer-provided benefits are usually set out in an employment contract, registered agreement, or workplace policy.

All employers must comply with their legal obligations, but there are many things you can do to make your business ‘best practice’ – that is, a great place to work.

Modern parental leave policies complement inclusive, family-friendly workplace practices and promote a more sustainable work-life balance for both women and men. A leading practice policy can guide leaders in supporting their employees to balance their careers with family transitions.

The risks of not having a proper policy 

According to Australian Business Lawyers & Advisors (ABLA), pregnancy is the lead discrimination complaint in Australian workplaces. It is critical that employers proactively manage their legal obligations and risks, as well as show their support for employees by ensuring they have a well-drafted parental leave policy. 

ABLA senior associate Tamsin Lawrence said employers with a clear, well-drafted policy could not only ensure they were not wrongly denying entitlement and discriminating against employees but it could assist in protecting employers against action by the Fair Work Ombudsman for failing to comply with the Fair Work Act and the Paid Parental Leave Act.

“Managing parental leave presents several challenges to employers regarding their legal obligations and employee entitlements,” she said.

“In large part, this is due to the fact that an employee’s right to take parental leave and their entitlement to parental leave pay are separate entitlements which are regulated by different pieces of legislation, with different eligibility rules." 

Federal, state and territory anti-discrimination laws also make it unlawful for an employer to discriminate against an employee on various grounds and it is unlawful for an employer to take adverse action against an employee for reasons related to their pregnancy or their entitlement to parental leave. 

“In order to manage all of these legal risks it is critical that employers have a parental leave policy which clearly and correctly sets out employee eligibility and entitlements, to ensure employers are not wrongly denying employees entitlements which could expose them to investigation and legal claims,” Ms Lawrence said.

“Lastly, in addition to protecting against a raft of legal risks, a well-drafted parental leave policy can also provide employers with a competitive edge in the labour market.”

MyBusiness Workplace can provide you with all the documents you need to manage parental leave in your business, as well as a wealth of resources to answer your information needs.