What employers need to know about parental leave

Offering parental leave and flexible work arrangements means retaining high-quality employees. These guidelines can help you keep your employees happy and keep your business in line with the law.

'Parental leave entitlements' is a broad term covering maternity leave, paternity leave, partner leave, adoption leave and the right of an employee to return to the same position.

Parental leave entitlements arise under the National Employment Standards (NES), which form part of the Fair Work Act 2009 (the act) and, at least as far as the private sector is concerned, apply to pretty much all Australian employers.

The basic entitlement is 12 months’ unpaid parental leave. This can be for either parent, provided the parent is to be the child’s carer, and can be shared if both parents are employees of the same employer.

There are some specific rules, referred to as 'birth-related leave', applying to pregnant female employees. It does not matter if the parents are in a de facto relationship rather than being married, and the rights extend to the adoption of infant children.

The act does not require the whole period to be taken, but does require the leave to be in a single unbroken period. Unpaid parental leave can be taken in conjunction with other forms of accrued leave.

A pregnant woman getting a blood pressure testAn employee may request an additional period of unpaid leave beyond the basic 12-month entitlement. While the employer is not obliged to grant this additional leave, it can only refuse on “reasonable business grounds”.

Many business owners and operators worry that parental leave will be a serious problem for the operation of the business.

The general limitations designed to protect against this are that parental leave entitlements are limited to employees who have worked continuously for 12 months prior to the date (or expected date) of commencing the leave.

Casual employees are not entitled to parental leave unless the employee has been a 'long-term casual' prior to this date and has a 'reasonable expectation' of continuing employment in the future.

It is therefore impossible for a newly hired female employee who is pregnant at the time of starting work to have the right to demand parental leave entitlements, because she would not fulfil the requirement of 12 months of continuous service prior to taking the leave.

One aspect of parental leave that might be of concern to you as an employer is the right of the employee to return to the job she or he held prior to going on parental leave.

When things are running smoothly, this may not be a problem. Indeed, the fact that the period of leave may be extended could help in securing a satisfactory temporary or casual replacement. But what if the business is shrinking and redundancies are on the horizon?

The brief answer is that employees cannot get better protection from the potential impact of a downturn than they would if they were still at work.

However, if the pre-leave position no longer exists, there is an entitlement of return to an available position for which the employee is fit and qualified.

It is a reality that one pregnancy can be followed by another, often not many years after the first. It is important to realise that the absence of an employee on unpaid parental leave does not break the employee’s 'continuous service' with you.

This means that an employee returning from parental leave does not have to serve another 12-month qualifying period before being granted another period of parental leave.

Another thing to bear in mind is the process by which you find a replacement for someone who is going to take parental leave. Some employers feel that it is acceptable to ask the person who is going on leave to find their own replacement. This is not appropriate for two reasons.

A pregnant woman sitting in a fieldThe first is that it’s not their job. You’re the employer. It’s your job. The second reason is that it can make the person going on leave feel guilty. Parental leave is just as legitimate a form of leave as any other.

You wouldn’t go to hospital to visit an employee who had had a car accident to ask them to find a temporary replacement for their role while they’re off work, so you shouldn’t do it in situations of parental leave either.

And at the risk of stating the obvious, you can’t sack someone on a whim while they’re on parental leave just because you like their replacement better. This may expose you to legal liability.

The good news is that plenty of information is available. The Fair Work Ombudsman website has a lot of useful material, including a resource for small businesses.

However, as good as this information is, it won’t necessarily give you advice about handling individual situations that may confront you as an employer. So what will help you avoid pitfalls?

The whole scheme set up under the act envisages that employers will consult with the employee. This means listening to the employee’s wishes and giving them serious consideration. However, consultation is a two-way street.

If something the employee wants to do presents a serious operational problem to a business, this is your opportunity to explain clearly what the problem is and to have a discussion about possible solutions.

A woman’s right to take leave when her child’s birth is impending cannot be questioned. However, a number of aspects of the scheme provide scope for an agreed approach that is satisfactory to both employer and employee.

It is highly recommended that as an employer, you document your decisions. For example, if you decline a request to extend parental leave on 'reasonable business grounds', it’s important that you can substantiate your reasons and demonstrate that these were clearly explained to the employee and any responses were taken into consideration.

Geoff Baldwin, Stacks Law FirmFinally, while the parental leave scheme has an undoubted social justice aspect, employers should also bear in mind that pregnancy is not fatal or permanent. Presumably you have invested a lot in the employee's training and development, so take a long-term view.

Geoff Baldwin is a lawyer at Stacks Law Firm.

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