Paid Parental Leave Gets a Boost: What it Means for Families and Businesses

The Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill was passed by the Australian parliament on 6 March 2023, and it brings important changes to the existing Paid Parental Leave scheme. It is the first change of several the Albanese government has indicated it will make to paid parental leave.

From 1 July 2023, eligible parents can take up to 20 weeks of paid parental leave, an increase from the previous 18 weeks. Under the new scheme, parents have greater flexibility to access the leave. The amendments allow claimants to take blocks of leave as small as a day at a time, remove the requirement that the primary claimant be the birth parent, and remove the requirement to not return to work in order to be eligible. In addition, the income threshold has been increased to combined household income of $350,000, which means more families are now eligible for the scheme. The Albanese Government has also announced a new parental leave pay rate, which will increase from the current rate of $774.10 per week to $820.60 per week, effective from July 2022.

The changes are designed to provide more support for families during the important early stages of their child’s development and to provide greater flexibility in how parents can take time off work. The new legislation is part of the government’s ongoing efforts to improve support for working families and to encourage greater workforce participation.

For how this impacts business, it is important to make sure you have a policy in place around parental leave. It’s crucial to keep in mind that merely having a parental leave policy in place is insufficient. It must be integrated into a business strategy to ensure a seamless process for employees taking parental leave, maintaining communication, and returning to work. This encompasses practical matters like work handovers as well as managing the cultural and team morale impact, especially in smaller businesses.

Key Takeaways

References Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022