Australia’s Paid Parental Leave Scheme – Important News for New Mums and Dads

The new Federal Government Paid Parental Leave (PPL) scheme started on 1 January, 2011 and replaces the Baby Bonus for eligible parents.

The PPL scheme provides up to 18 weeks payment at the federal minimum wage ($543.78 per week or $9,792 in total). The payment of $543.78 is a gross amount and tax is deducted as with any wage received.

This amount is a flat rate available to all eligible parents including part- time or casual employees, contractors or self-employed workers earning less than$150,000 per year.

Eligibility To be eligible for the government PPL Scheme, you must have completed a minimum of 330 hours work (an average of around one day of paid work per week) for 10 months in the 13 months prior to birth.

Primary care givers individually earning more than $150,000 in the financial year prior to the date of birth or adoption are ineligible for paid parental leave.

However it is important to note that primary care givers who don’t meet the minimum work requirements outlined above may still be eligible for the Baby Bonus.

PPL will still be payable to mothers in the tragic circumstance of a stillborn baby.

What happens to the paid parental leave provided by my employer? The new payment will be in addition to any PPL entitlements already provided by an employer. Employers who provide PPL through an industrial agreement cannot withdraw that entitlement for the life of the agreement.

The Baby Bonus PPL recipients are not entitled to the tax-free $5,000 baby bonus or Family Tax Benefit B. Parents eligible for the government scheme may elect to receive the Baby Bonus instead of paid parental leave if it is more beneficial for them to do so. A calculator to assist parents to calculate whether the baby bonus or parental leave scheme best suits them is available on the Family Assistance Office website. If you are unsure which is the best option for you the calculator will certainly assist you in making your decision.

When can I take the government PPL? The Government PPL must be taken after the birth or adoption of the child and within 12 months of that event. If a primary carer returns to work before they have received all of their PPL entitlement, they may be able to transfer the unused part of their PPL to another primary caregiver (usually the father) who meets eligibility requirements.

How do I receive my PPL entitlement? The Government provides the payment to an employer to pass on to the employee through their existing payroll system.

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