Australia’s New Protections for Paid Parental Leave
by activpayroll team
The Australian Government has introduced new protections for employees receiving employer funded paid parental leave under the Fair Work Amendment (Baby Priya’s) Act 2025, strengthening support for parents who experience a stillbirth or the early death of a child. The amendments ensure that employer funded paid parental leave cannot be refused or cancelled on the basis of such loss, recognising the significant impact on affected employees and aiming to provide compassionate and consistent support. These changes apply to employers that offer enhanced parental leave benefits and include limited exceptions where leave may be cancelled at the employee’s request or where an existing contractual right or entitlement applies.
Key Changes
The Fair Work Act now prohibits employers from refusing or cancelling employer funded paid parental leave for reasons related to the stillbirth or death of a child. This applies where both of the following conditions are met:
- The employee would have remained entitled to employer funded paid parental leave under their terms and conditions of employment if their child had not been stillborn or died
- The leave is associated with the birth of the employee’s child, the child of their spouse or de facto partner, or the placement of a child with the employee for adoption
These changes ensure that the parental leave entitlement is preserved even in cases of loss, providing important financial and emotional support for affected employees.
Effective Date
The new protections apply where a child is stillborn or dies on or after 7 November 2025.
From this date, an employer can only refuse or cancel employer funded paid parental leave if an exception applies or if the employee has requested the cancellation. Employers should note that non-compliance may result in civil penalties.
Exceptions
The protections do not apply if any of the following exceptions are met:
Right to cancel employer funded paid parental leave
If an employer has an existing right under an employment contract or enterprise agreement to refuse or cancel employer funded paid parental leave in cases of stillbirth or child death, these protections do not apply. This exception does not apply where terms are varied after 7 November 2025 to introduce such provisions.
No entitlement under existing terms
If an employee is not entitled to employer funded paid parental leave because of the stillbirth or death of a child under their current terms and conditions, the protection does not apply. This exception does not apply where employment terms are amended after 7 November 2025 to introduce these restrictions.
Other leave entitlements apply
The protection does not apply if the employee is entitled to other forms of leave related to stillbirth or the death of a child under their employment terms. Compassionate leave, unpaid parental leave under the National Employment Standards and similar entitlements cannot be considered alternative forms of leave for this purpose.
What Employers Need to Know
These changes do not require employers to introduce employer funded paid parental leave where it is not already provided. A similar protection already exists for unpaid parental leave under the Fair Work Act, and these new provisions extend that protection to employer funded leave arrangements.
Employers should:
- Review parental leave policies and employment contracts to ensure compliance from 7 November 2025
- Update HR and payroll procedures to reflect the new requirements
- Ensure HR, payroll and management teams understand the protections and applicable exceptions
- Refer to updated guidance from the Fair Work Ombudsman for more detailed information
These reforms represent an important development in supporting parents who experience stillbirth or the early death of a child and ensure compassionate and consistent treatment across Australian workplaces.
Australia - Global Insights
For further detailed guidance on payroll, employment law and compliance in Australia, visit our Australia Global Insights on the activpayroll website.
Next Steps
For more information on the Fair Work Amendment (Baby Priya’s) Act 2025, please get in touch. Complete our Contact Us form and a member of our expert team will be happy to assist with your queries.