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Paid parental leave is a government scheme for eligible working parents (check the Employment New Zealand website for eligibility criteria). If eligible, government payments go directly to the employee taking parental leave. This means you won't need to record those payments in MYOB Essentials.

An employee on parental leave will still accrue annual leave. All you need to do is stop paying wages for the period of parental leave.

To do this:

• If the employee has been set up on salary, you can remove the salary value from the Personnel tab of the employee's record.
• If the employee is paid hourly and you've set up usual units, remove these in the Calculate Pays screen. 

Paying annual leave at the Average Weekly Earnings rate

There is a section in the parental leave act that states any annual leave entitlement given either during, or within 12 months of an employee returning from parental leave, is to be paid at the average weekly earnings (AWE) rate only, although you can choose to still pay at the higher of AWE and ordinary weekly pay (OWP).

Any leave owed on the parental leave commencement date is paid normally.

More information

Employment New Zealand - Parental leave

Inland Revenue - Paid parental leave

business.gov.nz - Parental leave

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