**Updated 20 June 2020.
In November 2018, the minister for women, Kelly O’Dwyer released the government’s ‘Women’s Economic Security Statement’ which includes changes to Paid Parental Leave. There was a significant focus in the Statement on helping victims of domestic violence achieve economic independence through early access to superannuation and increased funding for no interest loans.
The start date for these initiatives will be for babies born after 1 July 2020.
The changes to Paid Parental Leave Scheme are designed to improve the flexibility of the current system, especially for those who are self employed and small business owners.
I regularly discuss with small business owners the problem of keeping their business going while meeting the requirements of the PPL Scheme of not working for 18 weeks. Few small business have that option available to them.
The proposed changes include:
Splitting your Paid Parental Leave into two separate blocks.
Currently you must take the entire 18 weeks of payments in one continuous block. If you need to return to work before your 18 weeks are finished then you lose any remaining PPL. About 2,300 people return to work each year before they have received the full 18 weeks of their payment entitlement and they miss out on the remaining few weeks payments.
The new initiative will mandate the first 12 weeks (60 days total) to be taken within the first year of the child’s life and will be called the Paid Parental Leave Period. The second block of six weeks (30 days total) can now be taken anytime up to your child’s’ second birthday and will be called the ‘Flexible Paid Parental Leave Days.’
All of the rules that currently apply to Paid Parental Leave such as the Work Test and Residency Test will still apply to the first 12 weeks, but now you have the option of returning to work after 12 weeks and not losing the remaining 6 weeks of payments. You still apply for your payments through myGov in the same way as before.
I will keep updating this post as Centrelink announce new information, but if you are expecting your baby after 1 July then apply for Paid Parental Leave as you would have previously and Centrelink will contract you around the 14 September 2020 to ask how you would like to use your Flexible Paid Parental Leave Days.
You can still take the 18 weeks as one continuous block if you choose to.
Changes to the Work Test
The current Work Test requires that you work for 330 hours in 10 months out of the 13 months before your due date. This must be done without a gap of more than 8 weeks between two work days.
The new initiative will allow for greater flexibility in the Work Test with gaps of up to 12 weeks allowed. There will also be the ability to move your Work Test dates forward should you have to stop work earlier in your pregnancy than expected. (This actually began 1 January 2020).
(Note: for babies born 22 March 2020 – 31 March 2021, the Work Test period will be for 20 months instead of 13 months, details here.)
The no interest loan scheme is already available and further information can be found here: https://goodshepherdmicrofinance.org.au/services/no-interest-loan-scheme-nils/
I have created a free checklist that you can download to help you gather the information you will require when you sit down and prepare your application. Enter your details below and the PPL Checklist will be emailed to you.
As always, feel free to ask any questions.