Should you offer Employer-Provided Paid Parental Leave?

All expectant mothers and primary carers are entitled to 12 months of unpaid parental leave if they have worked in a business for 12 months, as well as Parental Leave Pay provided by the Australian Government (PLP). But should you, as an employer, offer more on top of that?

We’ve compiled all that you need to know to make the most informed decision.

What is employer-provided paid parental leave?

You might know it as enhanced maternity pay or occupational maternity pay.

It's an optional payment that you choose to give your staff on top of the National Entitlement.

Usually, you would offer this additional pay under the condition that they return to work after maternity leave.

Whatever you decide, put the terms in your employee handbook. This will help your staff understand the scheme and acts as a reference document to help with queries in the future.

How much is employer-provided paid parental leave?

In Australia, employer-paid parental leave is not standardiszed by the government, and the amount provided can vary widely depending on your policies or the applicable contract.

Here’s what you need to know:

• Employers are not required to offer paid parental leave under the National Employment Standards (NES).

• There is no set rate — it is entirely determined by you, the employer.

• You don't have to make a fixed payment, either. You can give your staff a combination of their full pay and half- pay.

Here's how employers like to divide Employer-Provided Paid Parental Leave pay:

• Offer full pay for a set period (e.g., 6 weeks at full pay).

• Offer half pay for a longer period (e.g., 12 weeks at half pay).

• Offer a ‘top-up of government Parental Leave Pay’. This is paid at national minimum wage and would make the employee’s combined pay close to their full salary for the duration of leave.

• You could even give staff a return-to-work bonus as an extra incentive.

Should I offer Employer-Provided Paid Parental Leave?

The main downside to Employer-Provided Paid Parental Leave is the extra cost.

Paying your staff more than the legal minimum could put a strain on your business. Especially if two or more eligible employees go on maternity leave at the same time, but there are benefits.

If you enhance your staff's maternity benefits, they're more likely to want to stay working for you once their maternity leave ends.

They'll feel a sense of loyalty towards you, which could help with staff retention. When you keep committed and valuable staff working for you, it saves you from needing to replace them.

And that's not all. Enhancing staff pay during maternity leave is a benefit that'll attract other working parents to your business.

Parental Leave made easy with BrightHR

As an employer, understanding and supporting employees through maternity leave, not only demonstrates your commitment to their wellbeing but also contributes to a positive workplace culture.

The first step towards achieving this is having the right tools in place to help you fully understand and support your employees.

BrightHR offers a range of such tools, including a 24/7 employment relations advice line and an HR document library with hundreds of policy templates and guides. We can help you with a sample letter for maternity leave and all other issues relating to employee time away from work.

Not a BrightHR customer? Experience these tools for yourself by booking a free product demo today.