2nd July, 2018

What the families package change means for employers

Financial support for New Zealand families has increased thanks to the introduction of the Best Start tax credit and extension of paid parental leave.

Best Start

Best start is a $60 weekly payment that is not means tested, so all families are eligible until a child turns one.

Payments may continue from when the child turns one until they turn three for low and middle-income families.

Payments will start once paid parental leave payments end.

You can find out more about Best Start here.

Paid parental leave

Paid parental leave has increased from 18 to 22 weeks, with a further increase to 26 weeks from 1 July 2020.

Plus, the maximum payment increases from $538.55 per week before tax to $563.83.

The extension of paid parental leave is to provide more support to working families with newborns and young children.

The Parental Leave and Employment Amendment Bill was passed in November 2017.

You can find out more about paid parental leave here.

Keeping in touch hours

There’s also an increase in Keeping in Touch days from 40 to 52 hours from 1 July 2018, with a further increase to 64 hours from 1 July 2020.

These allow parents to do limited work while on parental leave, such as attending team days, annual planning or a change announcement without losing their entitlement to paid parental leave.

This is to help workers who are away from their workplace for a longer period to still maintain contact with their employer and keep up to date with any changes, and for the employer to continue to be connected with their employee.

What this means for employers

Best Start is one of the Working for Families tax credits payments and paid parental leave is a government funded entitlement paid to eligible primary care givers.

Inland Revenue makes this payment, not employers.

Some employers choose to top-up paid parental leave to support their employees during this time, and while a great initiative for looking after people, it is at their discretion.

Keeping in touch hours can be worked as full days, part days or for a few hours at a time.

The employer is responsible for this payment which must be paid at the employees normal working wage as per their existing employment agreement.