Payroll Bulletin 2

PAID PARENTAL LEAVE

The Parental Leave and Employment Protection Act 1987 provides minimum entitlements, rights, and protections for employees during pregnancy and while they’re on parental leave. Self-employed people may also be able to access parental leave entitlements as well depending on their situation and eligibility.

New parents who are employed may be legally entitled to parental leave to care for their newborn child, or for an adopted child under the age of six. There is also the option for parents to share and/or transfer some, or all their parental leave entitlement to their spouse or partner.

In some cases, other people who are not a child’s parents may also be eligible for parental leave, e.g., if another family member took over the primary care and responsibility of a child.

Employer’s Primary Legal Obligations

The primary obligation of an employer where an employee is eligible and takes parental leave it is that they must keep the employee’s position open for them duration of their parental leave.

There are very limited exceptions where an employer does not have to do keep an employee’s position open for them. These are either because:

• The employee’s position is a key one in the employer’s business, and it is not possible to secure a temporary replacement 

• The employee’s position becomes redundant because of a genuine change management process.

If the employer determines that an employee’s job is a key position and cannot be kept open, or there is a redundancy situation, then that won’t affect an employee receiving parental leave payments – provided they meet the eligibility criteria for payment. In addition, there is a 26 week 'period of preference' at the end of their parental leave that applies for both situations. This means that at any time during this 26-week period, if the employer has a position that is like the employee’s position, or one becomes available then they must offer it to the employee first before anyone else.

Forms of Parental Leave

The main forms of parental leave are:

Primary Carer’s Leave: 

The primary carer of a child under six is entitled to unpaid leave for up to 26 weeks if they’ve worked for either the six or twelve-month qualifying period, which are explained in the next section below.

Extended Leave: 

This only applies where the ‘twelve-month qualifying period’ is met. If so, then it provides that employees with a further 26 weeks of Extended Leave following the taking of the initial 26 weeks Primary Carer’s Leave. For completeness, the maximum amount of parental leave whether Primary Carer’s Leave and/or Extended Leave that a employee can take off is 52 weeks.

Qualifying Periods - Eligibility Criteria for Parental Leave

Primary Carer’s Leave (the six-month test):

An employee meets the ‘six-month test’ for parental leave if they will have been employed by the same employer for at least an average of ten hours a week in the six months just before the due date of the child, or the date they or their partner becomes the primary carer of the child under six permanently.

Extended Leave (the twelve-month test):

An employee meets the ‘twelve-month test’ for parental leave if they will have been employed by the same employer for at least an average of ten hours a week in the twelve months just before the due date of the child, or the date they or their partner becomes the permanent primary carer of the child under six. 

Sharing Parental Leave

Two parents can share Primary Carer’s Leave or Extended Leave. However, they must both meet either the six- or twelve-month eligibility criteria to get 26 or 52 weeks of parental leave, respectively. The eligibility criteria are explained above.

Other Types of Parental Leave

Special Leave:

Before a pregnant employee takes Primary Carer Leave, they can take up to total of 10 days’ unpaid special leave for reasons connected to their pregnancy, e.g., for medical appointments. 

Partners Leave:

Allows the partner of a pregnant person either one- or two-weeks unpaid leave, which can be taken on or around the expected date of a child, or assumption of care. 

Negotiated Carer’s Leave:

This allows employees to negotiate parental leave if they are not otherwise eligible for it. 

Information sources:

Employment New Zealand website: https://www.employment.govt.nz

Employer’s Assistance Ltd: https://www.employers.co.nz/parental-leave-new-zealand.aspx

Parental Leave Guide by Employer’s Assistance Ltd: www.employers.co.nz/parental-leave-guide-product.aspx

For further information and examples, contact Olga at olga@topflight.co.nz