Introduction

• 15 or more employees on 1 February 2023 and
• less than 15 employees on 1 August 2023.

To learn more about the changes, please refer to the following pages published by Fair Work Ombudsman and the ATO:

• Family & domestic violence leave
• New paid family and domestic violence leave
• Payslip requirements
• STP reporting guidelines
• Disaggregation of Gross Position Paper

Below are the key call outs for customers using MYOB PayGlobal.

Key changes

The key changes impacting employers and employees in Australia as per the above Fair Work Ombudsman links 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.

Key issues

• 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 reflect 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).

Key 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.
  

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  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 the leave is to be reported in Single Touch Payroll (STP)

  • Safety concerns have been raised in respect to the employee’s MyGov account/annual income statements being accessed with additional value now showing up.

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    Until we receive guidance from the ATO, employers should seek independent legal/financial advice on how FDVL should be reported within STP.

• What to display on Payslips for FDVL payment(s) and leave balances
  • Legislation says it must be included but the same safety concerns apply as for STP.
• How 'part-day' leave is to be calculated.Especially , 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.

How to implement this change into MYOB PayGlobal

For those customers who have implemented unpaid FDVL using the Leave Credits functionality, if you need to create a new Allowance record for paid FDVL, you will need to replace the instances where the old allowance is used. This may involve edits to ESS workflow, Leave Credit Table Leave Credits, Custom Reports, Award, and/or Payroll rules depending on your current configuration.

If nothing is recorded in your payroll system as yet, you will need to consider doing so, especially if as the ATO requires the earnings to be reported via STP.

To manage leave requests and the 10-day balance, use PayGlobals leave credit framework.