Paid Parental Leave Changes – Everything You Need to Know
I don’t believe the Government would reintroduce the Bill if it didn’t think it would pass. This is my summary of all of the changes you should know about if it goes through in its current state. There will probably be some changes before the final version.
The Bill refers to your employer provided paid leave as ‘primary carer pay’ and I will do the same here. Paid Parental Leave (PPL) is the 18 weeks of minimum wage provided by the government.
The media keeps using a start date of 1 January 2017.
The actual Bill has a start date of the following quarter after it is signed off by the Governor General. If that happens before 31 December 2016, the scheme will start 1 January 2017.
It will come down to a vote in the Senate. The Liberal government is relying on nine of the independent Senators to vote with them. They look to have the support of the four One Nation Senators, a vote from Derryn Hinch, the Family First Senator and the Liberal Democrat Senator. That makes seven.
As the nine Greens Senators are against the Bill, it really comes down to the three Senators from the Xenophon party to get it over the line. Nick Xenophon says he supports the Bill, but he would prefer a start date of 1 October 2017. That means that if you are currently pregnant you won’t be included in the changes.
How will it work?
Your 18 weeks of PPL will be reduced by the number of weeks of primary carer pay you receive from your employer. If your employer pays you 8 weeks of primary carer pay, you will receive 10 weeks of PPL at the minimum wage.
If your primary carer pay is less than the minimum wage, you will receive a top up to reach the minimum wage. This will be paid in one lump sum.
You will no longer be able to receive your PPL and primary carer pay at the same time.
28 day Backdating Rule
Currently, if you want the start date of your PPL to be the same as the date of birth of your child, you need to have completed your application (submit a claim and proof of birth) within 28 days of birth.
Some parents complete their application later than 28 days and find they don’t receive the full 18 weeks pay as they return to work. Going forward you will be able to backdate your application by 28 days, regardless of when you complete it within the year after birth.
Break during qualifying period
To be eligible for PPL you need to meet the work test which is to work 330 hours in a 10 month period of the 13 months before birth. Within that period you can have a break between days of work of up to 8 weeks.
That period will now be extended to 12 weeks which will help those who don’t have consistent employment to still meet the work test.
Some pregnant women have to give up work early in their pregnancy as their job is considered to be unsafe and no other suitable job can be found for them. Their work test is generally not met and they don’t receive PPL.
Going forward, the work test will become 330 hours in a 10 month period of the 13 months before the date you had to cease work instead of date of birth.
Payment will now come from Centrelink – not your employer
Now everyone will be paid from Centrelink unless you and your employer agree for you to be paid by your employer. There is no mention of how much tax will be taken out by Centrelink.
The government believes that by implementing these changes it will save close to $1billion over 4 years. Is there any benefit to employers now to provide paid leave? Will they just find other ways to attract staff and the government will still be making payments over 18 weeks to new parents? (Perhaps a cleaner or ready cooked meals for 18 weeks!!)
The positives are that more parents will become eligible for PPL from the changes to hazardous work arrangements and an increase in the break between work days. Administration will move away from employers which will help small businesses save time.
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