As organisations enhance their parental leave benefits, a common question arises - if an employee is eligible for employer-funded paid parental leave, can they also receive government Paid Parental Leave (PPL)? And do employers need to “top up” the difference?

With changes to Australia’s Paid Parental Leave scheme from July 2023, it’s important for employers to understand how these entitlements interact.

 

The key principle: two separate systems

There are two distinct types of parental leave payments in Australia:

  1. Government-funded Paid Parental Leave (PPL): Paid by Services Australia at the national minimum wage

  2. Employer-funded paid parental leave Provided under your organisation’s policy, contract or enterprise agreement

These systems operate independently. Employees may be eligible to receive both payments, however they are not mutually exclusive. 

 

What has changed - Dad and Partner Pay no longer applies

Before 1 July 2023, eligible partners could access a separate Dad and Partner Pay (DAPP) entitlement of up to two weeks. This is no longer current. The DAPP scheme has been abolished and combined into a single, shared Paid Parental Leave scheme.  

Today, families access a pooled number of PPL weeks and portions are reserved for each parent (including partners).

Action for employers: Review any policies that still refer to “Dad and Partner Pay” and update them to reflect the current scheme.
 

Can employees receive both PPL and employer payments?

Yes, in most cases, employees can receive government Paid Parental Leave, and employer-funded paid parental leave, at the same time or in sequence. 

For example, an employee could receive 18 weeks of employer-paid parental leave, and Government PPL during part or all of that period. 

 

Does employer-paid leave affect eligibility for PPL?

No, not by itself. To receive government PPL, an employee must 

  • Be caring for the child, and 

  • Be on leave or not working

Receiving employer-funded paid parental leave does not count as working and does not automatically disqualify eligibility. 

 

Do employers have to “top up” government payments?

No, there is no legal requirement for employers to top up government PPL.Whether payments are:

  • Offset (top-up),

  • Paid in full in addition, or

  • Structured sequentially

Action: double-check internal policy and/or enterprise agreement.
 

Common employer approaches

In practice, organisations typically adopt one of the following models:

  1. Top-up model (most common): This is where the government PPL is paid and the employer pays the difference between PPL and normal salary. The outcome is that the employee receives full pay during the funded period

  2. Sequential model: Employer-funded leave is paid first and then government PPL is taken afterwards. This often extends the total paid leave period, 

 

Best practice for employers to ensure compliance and clarity

  1. Review and update policies: Remove references to Dad and Partner Pay and refer to the current Paid Parental Leave scheme.

  2. Clearly define your approach: State explicitly whether PPL is offset, additional, or sequential and how payments will be administered

  3. Communicate early: Discuss arrangements before leave begins, confirm in writing. 

  4. Ensure consistency: Apply the same approach across similar employee groups


Bottom line

Government Paid Parental Leave and employer-funded parental leave are separate entitlements. Employees can generally receive both. Employers are not required to top up government payments. This depends on policy design. Clear, up-to-date policy wording is essential to avoid confusion and risk.