Changes to Australian Paid Parental Leave in 2023

Changes are being made to the Australian Paid Parental Leave (PPL) scheme and will affect those who have a child born or entering parental care from the 2023/24 financial year.

In 2023, the PPL scheme is set to become longer and more flexible, allowing parents and caregivers to better balance their work and parental commitments. Many employers have already moved towards providing their staff with flexible working arrangements, especially when it comes to family responsibilities, and the proposed PPL scheme reflects this change in workplace culture.

From 1 July 2023, the Paid Parental Leave Pay, and Dad and Partner Pay will be combined into one payment as well as increasing from the current 18 weeks (90 paid days) to 20 weeks (100 paid days). This entitlement will continue to increase by 2 weeks (10 paid days) each new financial year until it reaches a total of 26 weeks (130 paid days) in July 2026.

Parents will also be able to share their Paid Parental Leave Pay entitlements with each other, this includes taking PPL days at the same time and between periods of paid work. These changes shouldn't increase the burden on payroll managers directly, although businesses should be aware that more traditionally secondary caregivers may be taking more parental leave than they were able to previously.

In addition to this, combined family income limits will generally replace individual income limits. The combined family income limit must be under $350,000 in a financial year to be eligible for PPL, however the current individual income limit of under $156,647 per financial year will not change.

Employers will need to be aware of these changes when managing payroll for employees on or planning to go on paid parental leave in 2023 and beyond. Some employees may take longer periods away from work initially or choose to spread PPL days over the first 2 years of their child’s life.

More information is available from the Services Australia website.