Parental leave eligibility

[upbeat music] Parental leave can be one of those things that you haven't thought about until you, or perhaps one of your employees, needs it. It's an important topic, but a lot of us don't really understand how it works. Initially, parental leave was designed to protect employees starting a family so that they had time off and their job was still there when they returned to work. Later down the track, the law was updated so that people taking parental leave or stopping work could also receive a payment from IRD for that time off if they were eligible. We know parental leave can sometimes feel confusing, but don't worry, we are going to break it down for you so that you know the basics.

Yes, that's right. We're going to talk about the differences between parental leave and parental leave payments, and help you navigate the eligibility criteria for each. [upbeat music]

Let's start with a situation where someone is a pregnant primary carer, and know their expected date of delivery, or EDD. This is the date when a medical practitioner or midwife calculates that a pregnant primary carer will give birth, and it is crucial for determining eligibility for both leave and payments.

Exactly. The EDD is a key factor in the Parental Leave and Employment Protection Act 1987. It's the official due date as diagnosed by a medical professional. For other situations like adoption, parental leave and payments aren't based on the EDD. They're based on the dates someone becomes the primary carer by taking permanent primary responsibility for the care, development, and upbringing of a child who is under the age of six years. In surrogacy situation, the person who gave birth, also known as the biological mother or surrogate, and the new primary caregiver are fully entitled to both parental leave payments and parental leave from work if they meet the eligibility criteria. So the person that gave birth’s entitlements doesn't end when they hand over the care of their child. [upbeat music]

Now let's talk about parental leave from work and eligibility. The Parental Leave and Employment Protection Act 1987 provides for leave from work for birth mothers, their partners, and other situations where someone becomes the primary carer of a child under the age of six. There are different types of leave, including; primary carer leave, extended leave, partner's leave, negotiated carer leave, and special leave. All of these leave types are separate from the parental leave payments. The Employment New Zealand website has a lot of information about each leave type.

The length of parental leave varies depending on how long the person has been working for the employer. If an employee has worked for the same employer for at least an average of 10 hours a week in the 6 to 12 months before the EDD or date they become primary carer, they'll be entitled to parental leave. If they've been with the employer for at least 6 months, they'll be eligible for up to 26 weeks of parental leave, which is usually taken as 26 weeks primary carers leave. If they've been with the employer for 12 months or more, they'll be entitled to up to 52 weeks of parental leave, which is usually taken as 26 weeks primary carers leave, and then a further period of up to 26 weeks extended leave. [upbeat music]

Okay, that's the leave. Let's move on to the parental leave payments. The Act also provides payments for up to 26 weeks of parental leave, and in some cases, a period of preterm baby payments.

That's right. To be eligible for parental leave payments, there are specific test criteria for employees and self-employed primary carers. For employees, they must have been employed for at least an average of 10 hours a week for any 26 weeks of the 52 weeks immediately before the EDD in the case of a person giving birth or the spousal partner, or the date they become the primary carer for other arrangements such as adoption. Isn't that right, Kate?

Yeah, absolutely. So for a self-employed individual, they need to have been self-employed for at least an average of 10 hours a week for any 26 of the 52 weeks before the EDD in the case of a person giving birth or their spousal partner, or the date they became the primary carer for other arrangements such as adoption. If you are eligible for parental leave payments, you will need to apply for these through IRD. When receiving parental leave payments, it is super important that you do not continue working for any employer or your own business. Otherwise, the parental leave payments will stop. For an employee, if your employer agrees, you may be able to perform ‘keeping in touch days’ up to a maximum of 64 hours of paid work after the first 28 days of the child being born.

And there you have it. We've covered the basics of parental leave, including leave types, eligibility criteria, and payment requirements.

We really hope that we've cleared a few things up. If you're looking for more information, make sure you check out the Employment New Zealand website. The Employment New Zealand website has a lot of information and resources, including parental leave eligibility tool and a parental leave and payment eligibility table that can be used to work out what you may be entitled to. [upbeat music]

If you are both an employee of an organisation and run your own business as a self-employed person, you cannot combine these hours to meet the parental leave payment threshold test. You must meet the threshold test and be eligible as either an employee or as a self-employed person.

If you are a shareholder employee (i.e. owner of a company that you are employed in), you may qualify as either a self-employed person or an employee. Again, you can only meet the payment threshold test in either your employment or self-employment. However, note that if you meet the payment threshold test in each of your employment and self-employment, you can then combine the amount of earnings calculated to maximise payments you will receive during the payment period.

If you would normally have been but were absent due to any of the following reasons, this time is still counted towards the working period of employment for the purposes of determining whether you meet either the six or 12 month criteria for parental leave:

• on leave with pay 
• on leave without pay (other than parental leave) with the employer’s agreement
• pregnant and on primary carer leave prior to the expected date of delivery
• entitled to an ACC payment for that
• on volunteers leave
• absent for any other reason that doesn’t disrupt your normal pattern of employment, in the view of a Labour Inspector.

The Employment Court has previously determined that a period of time where someone has been engaged as an employee, but has not yet started ‘work’ with an employer, will not be counted towards the period of employment with that employer for the purposes of parental leave eligibility requirements.

What activities are work

Usually, an employee's old employer counts as the ‘same employer’ if:

• a trade, business or undertaking is transferred (e.g. sold) from one employer to another
• a body corporate is changed or replaced because of legislation
• trustees take over the business after the employer’s death
• there’s a change in partners, personal representatives or trustees who employ the employee
• the employee is transferred to an 'associated employer' (e.g. a subsidiary).

• If you’re a junior doctor working for a district health board (DHB) and you’re required to rotate between different DHBs as part of your compulsory training, your employments with each employing DHB are treated as one employment for the purposes of determining whether you meet either the six or 12 month criteria for parental leave.
• If you’re a teacher employed by multiple boards of trustees during the eligibility period, your employment by each board of trustees is treated as one employment for the purposes of working out whether you meet either the six or 12 month criteria for parental leave. You will still need to meet the hours of work criteria.

Paid parental leave (primary carer leave and parental leave payments)

Primary carer leave and parental leave payments enable the birth mother to look after a newborn baby and recover from giving birth. If the birth mother is eligible for these, then she will remain eligible regardless of whether the baby unfortunately dies before or after the birth.

The birth mother would still be eligible for 26 weeks of parental leave payments if she:

• meets the relevant eligibility work test as an employee or self-employed person
• has not transferred the entitlement to parental leave payments
• has not returned to work since her payment period begins (this begins when she starts parental leave or when she gives birth, whichever is earlier).

This allows the birth mother to take time away from work to attend to her health and wellbeing.

Paid parental leave can be transferred to a spouse or partner if they have (or intend to have) primary responsibility for the day-to-day care of the child and are eligible. However, it cannot be transferred if the mother or spouse/partner no longer have care of the child, for example, after the death of the child or removal from care. If it has been transferred prior to the loss of care, then it ends on the date of the loss of care.

Unpaid extended leave

The entitlement to extended leave requires an employee to care for a child. This eligibility requirement is no longer met if the child they are caring for or intend to care for unfortunately dies. In this case the employee would need to discuss their circumstances with their employer in good faith.

The employer and employee could still agree to bereavement leave or other contractual time off. If the employee returns to work before the date they first gave to their employer, they would still need to give 21 days’ notice.

Template letter to an employer in cases of stillbirth or death of a child [DOCX, 22 KB]

In surrogacy situations, both the birth mother and the new primary caregiver are fully entitled to paid parental leave (if they meet the eligibility criteria). The birth mother’s entitlement does not end when she hands over care of the child.