Dad and Partner Pay is coming - are you ready?

by External13 Mar 2013

Wondering how the new Dad and Partner Pay will impact your business? Here are some tips.

From 1 January 2013, the Australian Government’s Dad and Partner Pay will be available to eligible working dads or partners.

This new entitlement provides financial support for working dads or partners to spend more time with their family by providing them with two weeks of Government-funded pay at the rate of the National Minimum Wage (currently about $606 per week before tax). Dad and Partner Pay must be taken within the first 12 months from the child’s birth or adoption and claims must be lodged by the dad or partner who is eligible to receive the payment.

Dad and Partner Pay is administered and paid directly by the Australian Government and employees will need to apply directly to Centrelink. As employees cannot be working or on paid leave during their Dad and Partner Pay period employers and eligible employees will need to discuss and agree on unpaid leave.

Information for employers about the new payment is available here or through the business hotline on 131 158.

Employees should be directed here for more information or to the parents number on 136 150.

Here’s an example of how Dad and Partner pay could work:

Dean and Louise

Dean has been working as a qualified electrician for the past two years after completing his apprenticeship. His partner Louise is due to give birth to their second child in mid-March 2013.

Louise used to be employed at a local shop but stopped work after the birth of their first baby and since then has been the primary carer for little Jessica.

Dean talks to his boss and arranges to take one week of paid annual leave from his employer from the time the baby is born, followed by two weeks of unpaid leave. As Dean has worked with the same employer for the past two years, earns under $150 000 a year, is an Australian resident and meets the work test for Dad and Partner Pay, he plans to claim Dad and Partner Pay for the duration of his two weeks unpaid leave.

Dean lodges his pre-birth Dad and Partner Pay claim online at the same time as Louise lodges her Baby Bonus claim, a couple of months before the baby is due. They are already receiving Family Tax Benefit through Centrelink for Jessica and are aware that Dad and Partner Pay and Baby Bonus won’t affect this entitlement.

Soon after their new baby is born, Louise lodges the Proof of Birth form she received in hospital. This means that Centrelink can finalise her Baby Bonus claim and Dean’s Dad and Partner Pay claim so they can receive their payments.

Dean and Louise rely on Dean’s income for paying household essentials and bills, so Dad and Partner Pay will be ideal in giving the family financial support for Dean to be able to take extra time off work to bond with their new baby, take a greater share the caring responsibilities and support Louise from the very beginning.