Parental leave should be one of the most joyful parts of the employment journey — but for many employers it becomes a source of confusion, stress and accidental non-compliance. Across New Zealand and Australia, parental leave laws are detailed, technical, and often misunderstood. And because most employers don’t deal with parental leave regularly, the mistakes tend to repeat themselves.
The good news?
You don’t need to memorise legislation to get this right.
You just need clarity, structure, and early communication.
Here’s the practical, plain-English guide to the most common mistakes employers make — and how to avoid them.
1. Not understanding what type of leave the employee is entitled to
Across NZ and Australia, employees may be entitled to:
- parental leave
- partner’s leave
- negotiated return-to-work options
- protected unpaid leave
- government-funded payments
- flexible return or part-time arrangements
- leave for miscarriage or stillbirth
- additional unpaid leave
- job protection
- superannuation/KiwiSaver contributions (AU varies)
The entitlements differ — but the principle is the same:
Parental leave is a protected form of leave.
Employees can’t be treated less favourably because they’re pregnant, taking parental leave or returning from leave.
2. Confusing paid and unpaid entitlements
Many employers mistakenly believe:
- they must pay salary during parental leave
- all parental leave is paid
- payments come from the employer, not the government
- paying someone cancels their entitlement
Here’s the correct position:
New Zealand
- Parental Leave Payments are paid by the Government.
- Employers do not pay salary or top-up unless they choose to.
- Job protection applies for a set period.
- Additional unpaid leave is available.
Australia
- Government-funded Parental Leave Pay (PLP) applies for eligible employees.
- From 2023, PLP is more flexible and gender-neutral.
- Employers may have to administer payments but do not fund them.
- Awards or EAs may include employer-funded leave.
Confusion = risk.
Clarity = compliance.
3. Not documenting the leave plan early
A good parental leave process starts at the pregnancy disclosure stage — not at the “I’m going on leave tomorrow” stage.
Best practice includes:
- a parental leave planning meeting
- a documented leave plan
- agreed communication preferences
- clarity about return dates
- understanding of job-protected periods
- confirming entitlements (in writing)
- clear expectations around KIT/Keeping In Touch days (AU) or similar arrangements in NZ
Documenting early prevents misunderstandings later.
4. Mishandling “Keeping in Touch” (KIT) arrangements
New Zealand
Employees can do up to 64 hours of work during parental leave without affecting payments — as long as it’s agreed and doesn’t undermine the leave’s purpose.
Australia
Employees can work up to 10 days of KIT days without affecting PLP.
Common employer mistakes:
- assuming KIT days “restart” parental leave
- asking employees to return early without consulting
- paying incorrectly
- not documenting arrangements
- not ensuring the employee actually wants to work them
KIT days must be:
- voluntary
- mutually agreed
- safe
- documented
These days are a brilliant way to keep people connected — when used correctly.
5. Failing to manage job protection properly
Both NZ and AU laws require employers to:
- keep the employee’s job open, OR
- if that job no longer exists (e.g., restructure), offer a similar role that is:
- substantially the same,
- on no less favourable terms, and
- suitable for the employee.
This obligation is strict.
You can’t use parental leave as a chance to:
- downgrade a role
- reduce hours
- reduce pay
- move someone without agreement
- restructure someone out conveniently
Courts and tribunals take parental leave protection very seriously.
6. Misunderstanding return-to-work rights
Employees returning from parental leave may have the right to:
- return to the same role
- request flexible or part-time work
- job protection for a set period
- request adjustments
- undertake a graduated return
- be consulted on any proposed changes
Employers must:
- consult fairly
- genuinely explore options
- document discussions
- avoid discrimination
- manage reintegration thoughtfully
Many conflicts arise because this stage is rushed or poorly communicated.
7. Overlooking the emotional and human side of return-to-work
Returning from parental leave can be overwhelming — even for confident, high-performing employees.
People often feel:
- anxious about capability
- worried about judgement
- disconnected from their team
- unsure about changes that occurred
- torn between work and home
- exhausted
- overwhelmed
A supportive return-to-work plan can include:
- refresh or re-induction
- updated system training
- workload phasing
- wellbeing check-ins
- flexible options
- clear expectations
One HR Unlocked client put it perfectly:
“We used to treat parental leave like a transaction. After working with HR Unlocked, we treat it like a transition — and staff retention skyrocketed.”
Support matters.
8. Forgetting to update payroll, leave, and system access correctly
Errors often include:
- stopping salary at the wrong time
- incorrect holiday pay calculations (NZ)
- incorrect leave accruals
- failing to stop allowances
- giving access to systems too early
- failing to reinstate access promptly on return
Small mistakes here turn into large compliance issues.
9. Poor communication during leave (too much or too little)
Employees should NOT feel:
- forgotten
- overloaded
- pressured
- left out
- isolated
Ask early:
“How often would you like to hear from us during your leave, and in what way?”
Then stick to it.
A simple communication agreement prevents discomfort on both sides.
The bottom line
Parental leave is a time of massive change — for employees, families and workplaces. But when managed well, it strengthens loyalty, culture and trust like nothing else.
Across NZ and Australia, the key to getting it right is:
- communicate early
- document clearly
- understand entitlements
- protect the role
- support return-to-work
- avoid assumptions
- follow fair process
- treat people with dignity
Parental leave is not a compliance chore — it’s an opportunity to show your values in action.
If you want ANZ-ready parental leave templates, checklists, communication plans, return-to-work guides and manager scripts, HR Unlocked has everything you need — without the consulting fees or the legal jargon.
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