Changes to the Parental Leave Pay Scheme

From 1 July 2020, eligible employees can split their Parental Leave Pay so they take it over 2 periods within 2 years.

Parental Leave Pay (PLP) is a payment program from the Australian Government while an eligible employee cares for a new child. PLP is paid for up to 18 weeks and is currently $753.90 per week before tax.

To be eligible for PLP, the applicant must:

• be the primary carer of a newborn or newly adopted child
• have individually earned less than $150,000 in the last financial year
• not be working during the Paid Parental Leave period
• have met the work test in the 13 months before the child’s birth or entry into care.

Up until recently, employees could only use PLP as one continuous 18-week period (90 payable days).  From 1 July 2020 however, eligible employees are entitled to split their Parental Leave Pay so they take it over 2 periods within 2 years.

Employees can claim PLP for 1 set period and 1 flexible period.

Parental Leave Pay – set period

The first period is a set period of 12 weeks. This needs to be used within 12 months of the birth or adoption of a child and cannot be split into more than 1 period.

Flexible Parental Leave Pay

The PLP flexible period:

• is up to 30 days
• usually starts after the first period has ended
• can be used in flexible periods negotiated between the employee and employer
• has to be used within 24 months of a child’s birth or adoption.

Eligible employees can still get their PLP in a single continuous 18 week block. To do this, Services Australia will connect the person’s 12 week Paid Parental Leave period to their 30 Flexible Paid Parental Leave days.

Payment of the Parental Leave Pay Scheme

There have been no changes to how PLP is paid. In most cases, PLP payments are made to the employer, who then pays the employee.

PLP doesn’t change any paid parental leave offered by an employer; employees can get both.

Services Australia manages the PLP payment system.

Got an employee who’s announced the happy news they’re expecting? Check out what you need to know from our post on Keeping in Touch Days and Parental Leave here.