Paid Parental Leave Australia 2026: What Employers Need to Know

From 1 July 2026, government-funded Paid Parental Leave increases to 26 weeks for eligible parents. This is the final step in a three-year expansion of the scheme. Here is what changes, what it means for employers, and how to manage an employee taking parental leave properly.

Key change from 1 July 2026: Government-funded Paid Parental Leave increases from 24 to 26 weeks for parents of children born or adopted on or after 1 July 2026. Four weeks are reserved for the second parent on a use-it-or-lose-it basis, up from three weeks.

What is changing?

The government-funded Paid Parental Leave (PPL) scheme is administered by Services Australia and paid at the national minimum wage. Employers do not fund this payment. What changes from 1 July 2026:

• Total PPL increases from 24 to 26 weeks
• For couples, four weeks are reserved for the second parent and cannot be transferred if unused
• Single parents receive the full 26 weeks
• The ATO pays a 12% superannuation contribution on PPL payments directly to the employee’s super fund after the financial year

(Services Australia — Parental Leave Pay)

Does this cost employers anything?

The government-funded PPL is paid by Services Australia, not the employer. Employers are no longer required to administer the payments as they were under the old scheme. The superannuation contribution on PPL is also paid by the ATO, not the employer.

What it does cost employers is coverage. An employee taking 26 weeks of parental leave is away for six months. Workforce planning, backfill arrangements, and keeping the employee connected during leave are all things that need managing well.

“The payment is the government’s job. Your job as an employer is the planning: how do you cover the role, how do you keep the person connected, and how do you support a good return to work.”

What are an employer’s obligations during parental leave?

Under the National Employment Standards, eligible employees are entitled to up to 12 months of unpaid parental leave, with the right to request a further 12 months. (Fair Work Ombudsman — Parental Leave) The government-funded PPL can be taken within this period.

During parental leave, employers cannot terminate the employee’s employment because of the leave. The employee has the right to return to their pre-leave position, or a comparable position if the original role no longer exists.

What do employers need to do practically?

• Update your parental leave policy to reflect the new 26-week entitlement
• Plan coverage for the role during the leave period, ideally before the employee goes on leave
• Keep the employee informed of significant workplace changes during their leave
• Have a return-to-work conversation before they come back, covering any role changes, flexible work needs, and what to expect
• Train managers on appropriate conduct during leave transitions, including what not to say during the pregnancy and return-to-work process

What about employer-funded parental leave?

Some businesses offer their own paid parental leave on top of the government scheme. If your business does, check that your policy reflects the updated government entitlements and that it is clearly documented in employment contracts. A policy that offers “top-up” payments needs to be clear about how it interacts with the government PPL.

What if an employee wants to return to work part-time after parental leave?

Employees returning from parental leave have enhanced rights to request flexible working arrangements under the Fair Work Act. An employer must genuinely consider any request and can only refuse on reasonable business grounds, which must be explained in writing within 21 days. This is an area where getting the process right matters.

Jigsaw HR helps businesses across Australia and New Zealand manage parental leave processes properly, from policy to return to work.