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What you need to know about parental leave

Many employers do not know what their obligations are about parental leave. Recent amendments to the Fair Work Act now also need to be considered. It is timely to update you on employer’s obligations about parental leave.

Currently, under the Fair Work Act, obligations on employers include the following:

52 weeks unpaid leave

Employers must provide up to 52 weeks of unpaid parental leave for employees (including part-time employees) who have completed at least 12 months of continuous service with their employer. For casual employees to be entitled to this leave the employee must be a long term casual employee of the employer immediately before the date of birth or placement of the child. A long term casual employee is one that has been employed by the employer on a regular and systematic basis for a sequence of periods during the last 12 months.

Case Study: Tom is a director of an accounting firm that employs a number of staff in casual, part time and full time positions. Tom has recently been informed that Sally, a junior accountant employed on a full time basis, is 3 months pregnant and is looking to take some time off when the baby arrives.

Employees are required to give at least 10 weeks’ notice to employers of the request for parental leave. In addition, employees who are entitled to the 52 weeks unpaid parental leave have the right to request an extension of the first 52 weeks for up to a further 52 weeks. Such additional leave must be requested in writing and must be given to the employer at least 4 weeks before the end of the first agreed parental leave period.

By giving notice of her intention to take parental leave at this early stage of the pregnancy, Sally has satisfied the 10 week notice period and is entitled to 52 weeks unpaid parental leave.

Recent amendments to the Fair Work Act.

As of 27 November 2015, employers cannot refuse an employee’s request for additional parental leave unless the employee has been given “a reasonable opportunity to discuss” the request. A “reasonable opportunity to discuss” isn’t defined in the Fair Work Act but you should take it to mean a face to face meeting, telephone call or video conference. Following discussion with the employee, an employer may only refuse such a request on “reasonable business grounds” and must provide written reasons for the refusal. The total period of parental leave available under the Act is 104 weeks.

6 weeks prior to the expiry of her 52 weeks parental leave, Sally wrote to the firm requesting an additional 52 weeks of parental leave to commence immediately after the first 52 week period. Tom responded to Sally by dismissing the request without providing any reasons and without providing Sally with any opportunity to discuss the request.The firm is in breach of its obligations under the Fair Work Act as Tom did not provide Sally with a “reasonable opportunity to discuss” and did not provide “reasonable business grounds” for the refusal.

Right to return to pre-parental leave position

Once the parental leave period is over, the employee is entitled to return to their pre-parental position or, if that position no longer exists, an available position for which the employee is qualified and suited, nearest in status and pay to the pre-parental leave position. Employers should be mindful that a pre-parental leave position will not be considered to “no longer exist” purely because a replacement employee has been engaged. In cases where a role has simply been given to someone else, if you don’t give a suitable work to the returning employee, that person may be able to seek damages for reinstatement in the Fair Work Commission which could become costly for employers.

Right to be transferred to a safe job

Before the parental leave period even commences, pregnant employees have the right to be transferred to a safe job if her current job is considered unsafe due to pregnancy-related risks arising from the position. In cases where there are no appropriate safe jobs available, pregnant employees are entitled to take paid ‘no safe job leave’ for the period during which they are at risk.

Special maternity leave

In addition to the right to be transferred to a safe job, pregnant employees are also entitled to unpaid special maternity leave for any period of time in which they are unfit for work due to prescribed pregnancy related reasons that arise prior to their nominated departure for the pregnancy.

Flexible working arrangements

When returning to work from parental leave, employees have a statutory right to request part-time work or to make a request for other flexible working arrangements in order to assist with their caring responsibilities. Examples of flexible working arrangements include changes to:

  • hours of work (e.g. changes to start and finish times);
  • patterns of work (e.g. split shifts or job sharing); and
  • locations of work (e.g. working from home).

An employer must respond to a request, in writing, within 21 days of receiving the request. An employer may only refuse requests for flexible working hours on “reasonable business grounds”. Although what constitutes reasonable grounds must be determined on a case-by-case basis, reasonable business grounds may often include:

  • the requested arrangements are too costly;
  • other employees working arrangements can’t be changed to accommodate the request;
  • it’s impractical to change other employees working arrangements or hire new employees to accommodate your request; or
  • the request would result in a significant loss of productivity or have a significant negative impact on customer service.
Prior to returning to work, Sally requested that she work from home 1 day per week in order to pick up the baby from childcare early. In order to perform her role from home the firm will need to install a computer software system in Sally’s house which will cost the firm $15,000.00. This cost to the firm would likely constitute “reasonable business grounds” for refusing Sally’s request. 

The firm’s exposure if it doesn’t comply

If the firm does not comply with the Fair Work Act provisions on parental leave, it may be required not only to pay damages to your employee but also heavy penalties under the Fair Work Act.  These penalties could amount to over $50,000.00 for one single breach. Accordingly, it is important to seek legal advice from an experienced employment lawyer if you are considering refusal of a request for an extension of parental leave, flexible working arrangements, special maternity leave or transfer to a safe job or if you intend to employ your returning employee in a position other than the position the employee was employed in before going on parental leave.



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