Parental leave management: how to avoid the legal traps

Managing employees on parental leave and their return to work remains a challenging area for many small and medium-sized businesses. Nicole Hebblewhite, from law firm Holding Redlich, explains some of the areas that aren’t clearly understood.

It’s crucial that employers are aware of their obligations when managing the return to work of parents after the birth of their children.

The legal ramifications of mismanaging them are significant. Businesses can be exposed to claims of unfair dismissal, adverse action and discrimination, as well as penalties for contraventions of the Fair Work Act 2009.  Such claims don’t only place a financial burden on a business. They can also be time-consuming to defend and do reputational damage. It’s crucial to get the process right and be aware of your obligations and your employees’ entitlements.

Where both members of a couple are entitled to take a period of unpaid parental leave, they are able to take up to eight weeks of their parental leave entitlement at the same time. This concurrent leave may be taken at any time from the date of birth (or adoption/placement), in one eight-week block or in multiple blocks of no less than two weeks each. This is the only circumstance where the Act permits an employee to take parental leave at the same time as their partner. If each member of the couple intends to take a separate period of leave, they must be taken consecutively.

Employers have an ongoing obligation to consult with employees on parental leave about changes in the business that will have a significant effect on their post-leave status, pay or work location. Employers are required to take all reasonable steps to inform the employee about any changes affecting their position and provide an opportunity to discuss them.

At the end of a period of parental leave, an employee has a right to return to their pre-leave position. If that position no longer exists, they have a right to an available position for which they are qualified, and suited, nearest in status and pay to the pre-leave position. A pre-parental leave position will not cease to exist simply because a replacement employee has been engaged to perform the role. The Act now requires employers to inform employees covering a parental leave position that it is temporary and the leave-taking employee has a right to return to it.

Employees returning to work after parental leave have a right to request flexible work arrangements, including part-time work. Employers aren’t obliged to automatically accept such requests. However, if they intend to refuse, they need to be able to demonstrate that they have reasonable business grounds to do so, and notify the employee of the reasons in writing. What constitutes reasonable business grounds is determined on a case-by-case basis. A recent decision by the Fair Work Commission ruled that the employer had legitimate reasons for refusing a request to return to work part-time where it could demonstrate that:

• The employee’s role was, on the basis of current business needs, required on a full-time basis.

• There were no appropriate part-time roles available.

• The business had been significantly downsized and streamlined during the employee’s absence. 

Employers should give genuine consideration to any request for flexible working arrangements, and balance any adverse impacts on their business with those on the employee making the request. This will help to ensure compliance with obligations under the Fair Work Act and anti-discrimination legislation, as well as promote a transparent and accommodating workplace culture.

An employee will not accrue annual, personal or long service leave while they are on unpaid leave. However, if they are on paid parental leave, the other types of leave would accrue accordingly.

Before unpaid parental leave begins, a pregnant employee has the right to be transferred to an appropriate safe job if her current position is considered unsafe due to pregnancy-related illness or risk, or due to hazards connected with the position. In circumstances where there is no appropriate safe job, the employee is entitled to take paid ‘no safe job leave’ for the period in which performing their role would be unsafe.

Pregnant employees are entitled to unpaid ‘special maternity leave’ if they are unfit for work because they have a pregnancy-related illness, or the pregnancy ends within 28 weeks of the expected date of birth otherwise than by the birth of the child. An employee must give an employee notice of their intention to take special leave as soon as is practicable. Generally, however, in the case of short-term absences due to illness, an employee will be required to use their personal leave.

Information provided in this article is general only and it does not constitute legal advice and should not be relied upon as such. SEEK provides no warranty as to its accuracy, reliability or completeness. Before taking any course of action related to this article you should make your own inquiries and seek independent advice (including the appropriate legal advice) on whether it is suitable for your circumstances.