5.2.10 Collection from Parental Leave Payments
The Registrar can collect a payer's child support and spousal maintenance payments by making deductions from parental leave pay payable to that person (CSRC Act section 72AD). The Registrar can also collect a payer's carer debt by making deductions from parental leave pay payable to that person (CSRC Act section 72AD).
From 1 January 2011 parents (natural and adoptive) who have been working and have given birth to a child or adopted a child, may be eligible to receive parental leave payments for a period of 18 weeks. The amount of the payment is at the rate of the National Minimum Wage. The payment is paid by either the parent's employer or Centrelink.
The Registrar can give written notice to Centrelink to deduct an amount from a parent's parental leave pay to collect the parent's enforceable maintenance liability, child support debt or carer liability (CSRC Act section 72AD).
If payments are paid by the employer, the Registrar can collect by applying employer withholding (5.2.3), or by issuing a CSRC Act section 72A notice (5.2.9) if employer withholding is not appropriate. Employer withholding cannot be used to deduct from a parent's parental leave pay in circumstances where an employee has debt, but no enforceable maintenance liability.
Section 69 of the PPLAct enables Centrelink to comply with the notice and forward the amounts to the Registrar.
When can deductions be made from parental leave pay?
CSRC Act section 72AD deductions can be made in the following circumstances:
- payers with an ongoing liability arising out of a child support assessment, a court order, a court registered maintenance agreement, or collection agency maintenance liability,
- payers with ongoing liabilities arising under a spousal maintenance order or overseas maintenance liabilities,
- payers who have an outstanding debt under a recovery order that is registered for collection by the Registrar,
- payers with arrears (i.e. amounts that were not paid when they fell due and payable),
- payers with a carer debt due to the Commonwealth under CSRC Act section 69B, or
- payers with debts to consolidated revenue which are still debts to the Commonwealth under CRSC Act section 30.
CSRC Act section 72AD cannot be used to collect:
- late payment penalties, or
- estimate penalties.
Issuing the Notice
The Registrar starts deductions from a payer's parental leave pay by giving Centrelink a written notice specifying:
- the payer's name,
- sufficient detail to enable Centrelink to identify the person, and
- instructions to make fortnightly deductions of a specified amount from a specified day. The specified amount can be for an ongoing liability, an ongoing liability and arrears, or carer debt.
The Registrar is not required to give the payer a copy of the notice.
How much can be deducted
Centrelink cannot deduct the full specified periodic deduction from a payer's parental leave pay if that would leave the payer with less than the 'protected earnings amount' (CSRC Act sections 72AD(3) and 72AD(4)).