Next steps for paid parental leave in Australia

Conclusion

There are tensions in the purposes of paid parental leave schemes between facilitating health and wellbeing of mothers and babies, enhancing women’s workforce participation, and achieving greater gender equality by encouraging fathers to share in the care of young children. This makes trade-offs between these goals implicit in the design of schemes, including in considering the optimum arrangements to extend Australia’s scheme by 6 weeks.

We have provided three archetype models that focus either on flexibility and shared care (Model 1), incentivising fathers to participate in care and mothers to participate in the labour force (Model 2) and enhancing time for mothers’ and babies’ health, bonding and support for breastfeeding (Model 3).

Model 1 provides for shared care and fully flexible arrangements. This model allows mothers to use the majority of the leave if they wish, but also enables and encourages fathers through a reserved portion to share the care role. The model has flexibility by allowing couples to decide how they wish to share their leave and in what units – days or weeks – they prefer and that suit their paid work and family responsibilities over the first 2 years of a child's life. The introduction of a greater shared portion aligns well with schemes internationally. By allowing all non-reserved leave to be taken concurrently if desired by parents, this design would quickly shift the emphasis from a primary carer model currently in place to a full choice in care model. It is recognised that this may be too large a shift in the first year in policy terms so restricting the concurrent time would also be possible. Such a move would be closer to Model 2.

Model 2 incentivises fathers/partners to increase their participation in care and restricts concurrency, thus forcing parents to decide who will take the leave. Having fathers take a longer period of reserved leave may encourage them to take more of the remaining leave, especially as that leave is offered flexibly in days over 2 years. This may enable a combination of fractional work hours for both parents, thus potentially enabling women’s greater labour force attachment. It should be noted, however, that while paid parental leave is at the national minimum wage, the barrier for the higher income earner (usually the father given the gender pay gap) to take the majority of the leave continues to exist.

Model 3 attends more to the issue of the care and wellbeing of mothers by reserving a longer period of leave for them. The experience in Australia is that mothers overwhelmingly use the current 18 weeks, and neither Model 1 nor Model 2 would restrict mothers from continuing to use this period should they wish.

Any of the models could be enhanced in 2026 to further incentivise fathers to share care through adding a bonus period of 2 weeks (or longer) of paid leave for parents who use all their reserved portion of leave. This would increase the total possible leave time to 28 weeks, or longer.

As Australian families continue to change their practice and aspirations for how to share paid work and unpaid care for young children, ongoing evaluation and resourcing must also be part of the plan for a more generous paid parental leave system. To support families to manage work and care Australia will need to further extend the national paid parental leave scheme to bridge the current ‘care gap’ and connect with the early childhood education and care system in a way that supports child wellbeing, education and health and parental workforce participation, especially by mothers.