Maternity leave and pay in Australia
Reviewed by Mellow Editorial Team, HR & payroll content team
Paid parental leave in Australia comes from two sources: a government scheme administered by Services Australia, and any additional entitlements your employer has put in place. Employees do not receive "maternity pay" from their employer by default — but they do have strong job-protection rights under the National Employment Standards.
The government's Paid Parental Leave scheme
The federal government's Paid Parental Leave (PPL) scheme provides up to 22 weeks of paid leave for a child born or adopted on or after 1 July 2025, rising to 26 weeks by 2026. Payments are made at the national minimum wage rate and are treated as taxable income, so PAYG withholding applies in the normal way.
Eligibility is means-tested. The primary claimant must have met a work test (generally 10 of the 13 months before the child's birth or adoption), an income test, and must be the primary carer. The scheme has been progressively expanded to allow both parents to share the entitlement, with a portion reserved for each parent on a use-it-or-lose-it basis.
Employers are no longer required to administer PPL payments on behalf of the government — Services Australia pays claimants directly. Your obligation as an employer is mostly to let employees know the scheme exists and to handle any top-up arrangements your own policy provides.
Job protection under the National Employment Standards
Under the National Employment Standards (NES), eligible employees are entitled to up to 12 months of unpaid parental leave, with the right to request a further 12 months. This applies to permanent employees who have completed at least 12 months of continuous service, and to long-term casual employees in some circumstances.
Key protections include:
- The employee's position must be kept open while they are on leave, or a comparable role offered if the original position no longer exists.
- Employees cannot be dismissed because they are pregnant or taking parental leave.
- Flexible return-to-work requests must be genuinely considered.
These protections apply regardless of whether the employee is receiving government PPL payments or not.
Employer-funded top-ups
Some employers offer paid parental leave on top of the government scheme — commonly called "employer-funded parental leave" or a "top-up." This might be a set number of weeks at full or partial pay, funded entirely by the business.
If your organisation provides this, the payments are wages: they go through payroll, attract PAYG withholding, count as ordinary time earnings for Superannuation Guarantee purposes (currently 12%), and are reported via Single Touch Payroll at each pay event. Make sure your employment contracts or policy documents clearly describe the entitlement, any qualifying conditions (such as a return-to-work requirement), and whether it can run concurrently with the government scheme.
Superannuation during parental leave
Superannuation is not automatically required on unpaid parental leave periods — ordinary time earnings must actually be paid for the 12% Superannuation Guarantee obligation to apply. If you are paying a top-up, super is owed on those payments.
The federal government has legislated that super will be paid on government PPL payments from 1 July 2025. Services Australia pays this super directly to the employee's nominated fund alongside the PPL payment — you as the employer do not process it. This is a significant change worth communicating to employees, as it closes a long-standing gap in super savings for primary carers.
Payroll and compliance obligations
While an employee is on parental leave your core payroll obligations do not disappear. Specifically:
Annual leave accrual. Permanent employees continue to accrue annual leave (4 weeks per year under the NES) during periods of paid parental leave. Accrual during unpaid parental leave depends on the applicable award or enterprise agreement — check the relevant instrument.
STP reporting. If you are making any top-up payments, report them through Single Touch Payroll at each pay event as you would any other wages payment. Finalise the employee's income statement by 14 July after the end of the financial year.
HECS/HELP. If the employee has a study debt, PAYG withholding on any top-up payments should account for their repayment band in the normal way.
Return-to-work tax implications. When the employee returns, their tax file number declaration and withholding rate carry over — no new paperwork is needed unless their circumstances have changed.
The most common compliance gap is treating parental leave as a payroll pause and forgetting that top-up payments are ordinary wages with super attached. Getting that wrong creates underpayment exposure that can be costly to unwind.
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