UPDATE: More flexibility for Paid Parental Leave scheme

In February, we advised clients of the Government’s proposal to allow for more flexibility around the taking of Government-funded paid parental leave. Despite the obvious barriers to Parliamentary business posed by the COVID-19 pandemic, the Paid Parental Leave Amendment (Flexibility Measures) Act 2020 (the Act) received Royal Assent on 16 June and came into force on 1 July 2020.

The Act provides for parents of children born or adopted from 1 July 2020 to access the traditional 18-week paid parental leave (PPL) entitlement as an initial “non-flexible” period of up to 12 weeks (to be taken within the 12 months following the birth or adoption of the child) with the remaining “flexible” period of up to six weeks able to be taken any time after the initial period, as long as it is used within two years of the birth or adoption of the child.

The initial non-flexible 12-week PPL period will be accessed in the same manner as the traditional 18-week entitlement but the flexible period of up to six weeks (30 days) may be utilized in a block period or as individual days, as long as it is accessed by the time the child turns two. In certain circumstances, the flexible period may also be accessed by a secondary claimant, providing the primary claimant has authorized the arrangement.

Where the primary claimant seeks to access their flexible paid parental leave in a single block (of up to six weeks), the employer will continue to be responsible for administering the paid parental leave payments. The Government will assume this responsibility where the primary claimant seeks to access their flexible paid parental leave in separate periods (of up to 30 days).

Whilst the Government assuming responsibility for administering PPL payments where the primary claimant elects to access their flexible paid parental leave entitlement in separate periods will provide some small respite to employers who have, understandably, struggled historically with the burden of administering a Government benefit through their own payroll system, in practice, this flexibility – if triggered – will necessitate an even higher number of employee requests for flexible working arrangements.

Section 65 of the Fair Work Act 2009 conveys the right for a worker returning from parental leave (as well as other eligible employees) to request changes to their working arrangements such as amended or reduced working days or hours. Whilst the right to request changes does not equate to the employee being entitled to ‘demand’ particular days, duties or hours, etc, (as explored in our related article from October 2019 – ‘Request for flexible working arrangements not akin to ‘demand’: FWC) many employers could be forgiven for having difficulty accommodating and negotiating such requests, especially if more than one arrangement is active in the workplace at any point in time.

Although employers can refuse a request for flexible working arrangements on reasonable business grounds, a methodical process must first be followed and the reasons for the refusal conveyed to the employee in writing, within 21 days of the request being received. The process is onerous and potentially intimidating for employers, especially if the bespoke arrangements of an expectant employee cannot be accommodated, and these changes to how PPL may be accessed, at least in part, will likely increase the number of requests for flexible working arrangements employers are expected to juggle. ES Clients are invited to take advice from the ES Team on (07) 3220 3500 before responding to an employee’s request for flexible working arrangements.  

Further background on the changes to the PPL scheme, as well as examples of how the amendments could apply in practice, can be found in our original article of February – Government proposes more flexibility for Paid Parental Leave Scheme. Information is also available for employers and employees on the Services Australia (Centrelink) website.