Paid family and domestic violence leave - Australia

The key changes impacting employers and employees in Australia are:

• Entitlement changes from 5 days unpaid to 10 days paid.

• New employees that commence on/after the effective legislation date get 10 days from 1st day of employment – they do not have wait for 12 months anymore.

• Existing employees on the effective legislation date, will have their existing balances reset to 10 days. When their next employment anniversary falls, the balances are required to be reset again to 10 days. 

  This does mean some employees could legitimately access to more than 10 days paid within the first 12 months of the effective legislation date.

• Leave can be taken in any quantity either continuously or not, for example 1 hour here and there or 10 days in one block or any combo in between.

• FDVL supersedes other leave.

  • If employee is on Annual or Sick leave and they need to take FDVL, then the FDVL would replace the other leave.

  • There will be no difference to an employee getting sick whilst on annual leave. This means existing leave requests would need to be replaced/modified. “Other leave payments” may need to be reversed so that the other leave balances and liabilities get credited back what was replaced by FDVL.

• Casual employees can take FDVL outside their rostered hours of work. But the employer is only required to pay FDVL for the days/hours they were rostered. This does not stop the employer from paying generously although they are not required to.

• Pay slips must not mention paid family and domestic violence leave, including any leave taken and leave balances.

  • From 4 February 2023, an amount paid to an employee for taking paid family and domestic violence leave has to be recorded on a pay slip as ordinary hours of work, or another kind of payment for performing work, such as an allowance, bonus or overtime payment.

  • However, if an employee requests it, their employer can record time taken as paid family and domestic violence leave as another type of leave on their pay slip (for example, annual leave).

  • It is best practice for their employer to record this on their pay slip in a way that makes the pay slip look as close as possible to how it would have looked if the employee had not taken the leave.

• STP reporting of FDVL amounts should match that of the payment type shown on the employee's payslip. This may be any of the following:

  • Gross, if shown as an employee’s ordinary hours of work

  • A payment made in relation to the performance of the employee’s work, including (but not limited to) an allowance, bonus or a payment of overtime

  • Other Paid Leave, where requested by the employee (or, before 4 June 2023, where an employer is making use of the grace period contained in the regulations), an amount paid for taking a period of another type of leave (other than a period of paid family and domestic violence leave).

We are still waiting for guidance from Fair Work Australia on the following issues:

• Clarification on how an employer can validate an employee received their full rate of pay. For example, should it just be the planned work hours that get replaced in payroll or should all pay items be replaced with FDVL using a consolidated rate.

Until we receive guidance from Fair Work/DSPANZ, employers should seek independent legal/financial advice on how FDVL should be represented within the payroll system.

• How 'part-day' leave is to be calculated, especially if the employee is also entitled to incentive-based payments such as bonuses, loadings, monetary allowances, overtime or penalty rates and any other separately identifiable amounts.

We recommend creating the FDVL entitlement using the unit Days. We have also included settings to set it up in Hours, for sites using MYOB Acumatica — Workforce Management who would like their employees to be able to submit leave requests for FDVL.

To set up an FDVL entitlement

1. Go to the Entitlements form and click the Add New Record icon (

   

   ) on the form toolbar.

2. On the Rules tab, complete the fields:

   Field	Value (using Days)	Value (using Hours)
   Trigger Date	Employee Start Date	Employee Start Date
   Units	Days	Hours
   At Period End	Clear balance	Clear balance
   Time period after trigger date	0	0
   Period Duration and Period	1 Year or 12 Months	1 Year or 12 Months
   Entitlement Unit	10	The number of hours constituting 10 working days. You may need several entitlements, covering different employee groups.
   Lump Sum	Yes	Yes
   Non Accruing Entitlement	No	No
   Include Entitlements Movement Summary	No	No
   Include Accruals	No	No

3. On the Valuation tab, complete the fields:

   Field	Value (using Days)	Value (using Hours)
   Valuation Method	Specific Pay Rate	Standard Hourly Rate
   Rate	2 Daily Rate, or another rate dedicated for FDVL.	n/a

4. On the form toolbar, click the Save icon (

   

   ).

Accrual pay item

Payment pay item

Multiple pay items may be required  If you need to pay FDVL for multiple employees in the same pay with different payslip labels, you will need a separate payment pay item for each to allow for different labels and (potentially) ATO categories. Otherwise, you can maintain a single pay item and update the label and ATO category as required.

The eligibility dates for FDVL are 1 February for employers with 15 or more employees, and 1 August for those with less than 15. On those dates, all existing employees will be entitled to the initial 10 day FDVL balance, and new employees will get it when they start.

1. Add the accrual pay item to all relevant standard pays.

2. Use the Entitlement Adjustment form (MPPP3000) to add an opening balance of 10 days to employees as they become eligible:

   • For the Type, select Opening Balance.

   • Enter the date the employee becomes eligible as the Transaction date

   • Add a balance adjustment for 10 days (or the corresponding number of hours)