Having a baby or taking permanent responsibility for a child’s care is a momentous step in anyone’s life. In a work context, it means a team member will need to take some time away, both in the lead-up to the child’s arrival and once they arrive.
Parental leave and supporting expectant and new parents has been a government focus in New Zealand for several years, with the length of paid parental leave being extended in 2020 and parental leave payments increasing in 2022. Parliament is also considering a Bill to ensure spouses or partners who are carers of a child can split and take paid parental leave at the same time as each other.
Businesses and employers have legal obligations when it comes to providing working parents with parental leave, but how it works in practice can be complex and unclear. Understanding your responsibilities and providing your employees with leave and support during this important time can help ease the stress of this transition.
In this blog post, we shed light on the rules around parental leave and employees’ entitlements to paid parental leave, what leave partners can take, and what happens when a person takes parental leave.
In a follow-up post, we’ll look at ways to prepare for a team member who is going to become a parent, how to support them when they take leave, and how to best manage their return to work.
Eligibility for parental leave (time away from work)
If one of your employees or their partner is having a baby or taking permanent responsibility for the care of a child under 6, they will probably be entitled to parental leave.
Eligibility has some wrinkles but any employee who has worked for an organisation for an average of 10 hours a week or more for:
- 12 months or more just before the expected birth of the child (or the date they’ll take over the care of the child), is entitled to 52 weeks of parental leave (26 weeks primary carer leave and a further 26 weeks extended leave).
- 6 months or more just before the expected birth of the child, or date they’ll take over the care of the child, is entitled to 26 weeks of parental leave (primary carer’s leave only).
Employment.govt.nz has more information on parental leave entitlements.
Parental leave payments
There is a separate eligibility test for government-funded parental leave payments: Anyone who has earned an income, in at least 26 weeks of the 52 weeks before the birth of the child (or date the child comes into their care), will be eligible for financial support from the government.
This includes eligible casual, seasonal, temporary and fixed-term employees, and self-employed people.
Payments equal the person’s ordinary weekly pay or average weekly income (whichever is more), up to a maximum of $661.12 a week before tax.
If your income is irregular, the IRD will take the average of the 26 weeks that you were paid the most, from the 52 weeks before the birth of the child (or the date the child comes into your care).
The money is paid by the IRD to the person’s bank account each fortnight, with income tax and other tax or payments (e.g. student loan, child support) deducted.
Employees eligible for parental leave payments can take any other type of paid leave they're entitled to first - e.g. annual or special leave, alternative days, time off in lieu - and can start their parental leave payment period after taking that leave (even if it’s after the child's arrival).
If the employee resigns or stops working instead of taking leave, they can still get paid parental leave.
Find out more about paid parental leave at IRD.govt.nz.
What’s a primary carer?
A primary carer is anyone who has taken permanent primary responsibility for a child under 6, e.g. an adoptive or whāngai parent, Home for Life parent, a grandparent with permanent full-time care, and others with permanent care arrangements.
Primary care does not include part-time or temporary responsibility, e.g foster care or childcare arrangements, and does not usually include the spouse or partner of the person who is pregnant or recently gave birth.
Partner’s leave
Partners of a primary carer are entitled to:
- 1 week of unpaid leave if they’ve worked for you for 6 months, for at least an average of 10 hours a week, or
- 2 weeks of unpaid leave if they’ve worked for you for 12 months, for at least an average of 10 hours a week.
They can take this leave in the time between 21 days before the expected birth, or the date their partner intends to become the primary carer, and 21 days after, unless the employer agrees otherwise. This leave is in addition to any other parental leave they’re sharing with their partner.
Employees are allowed to work up to 52 hours while on paid or unpaid parental leave, but both the employer and employee must agree to this.
Special leave for pregnant employees
Pregnant employees can also take 10 days of unpaid special leave for things like doctor’s appointments and antenatal classes, before taking primary carer leave.
Employer responsibilities when an employee applies for parental leave
A lot of the complexity around parental leave is down to the fact that there are 3 questions that have to be answered when an employee applies for parental leave:
- Does the person have the right to take time off work? This depends on how long they’ve worked for the business (see above).
- Does the person have the right to return to the same job at the end of their parental leave? Yes, unless the employer consults with the person otherwise under limited circumstances (see below).
- Does the person have the right to payment from the government during their time off? This depends on whether they've earned money for 26 or more weeks in the 52 weeks before becoming a parent.
The first 2 are assessed by the employer (plus the length of service/average hours the employee has worked) because the person’s absence from work is going to affect them the most.
The third is assessed by IRD because they're the ones paying the person money.
The employer must then approve or decline their leave request within 21 days. If you need more information, you must let the employee know within 7 days and the person must provide this within 14 days of being asked
Once the leave arrangements are settled, you need to confirm them in writing.
Keeping a role open
While the business can’t decline employee requests for parental leave, you can decline to hold the person's position open under limited circumstances:
- The employee will be gone longer than 4 weeks.
- You can prove their role is crucial to the business.
- You can prove that it’s not possible to find a short-term replacement.
You are obliged to consult with the person about this (as it is a change to the terms of their employment).
In all situations, the employee can take time away from work and return to the business, but under these limited circumstances, they wouldn't return to their same job.
For example, if the company’s chief executive or a key manager took parental leave, their role is obviously critical to the success of the organisation and will be hard to fill for a short period. So, the business could consult with the person to say: “Yes you can take time off, and when you come back there will be a position for you, but it won't be the CEO (or key managerial) job.”
Workers who aren't eligible for parental leave
Employees who don’t meet the criteria for parental leave, e.g. they’ve worked for you for less than 6 months or haven’t done an average of 10 hours a week, are not entitled to any parental leave. But if they meet the threshold test for parental leave payments and will be the child's primary carer, they might apply for negotiated carer leave so they can receive the government payments.
You don’t have to agree, but you must reply as soon as possible and within 1 month. If you say no, you must tell them on what grounds you refused and why those grounds apply.
Taking parental leave
Parental leave (primary carer and extended leave) can be taken by one parent or split between them, as long as they’re both eligible.
This means the primary caregiver might take the first 3 months off work, and then transfer their entitlement to 3 months primary carers leave and 6 months of extended leave to their partner, who becomes the primary carer for the remaining 9 months of leave.
Primary carer leave can start up to 6 weeks before the expected date of the child's arrival, or earlier if the employer and employee agree to it, it comes at a doctor’s or midwife’s instruction, or the pregnant employee can no longer do their job safely/adequately and no other suitable work is available (at an earlier date specified by the employer).
If in unfortunate circumstances the baby dies before or after birth, the birth mother is still entitled to primary carer leave.
