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8.9 Continuing payments and AE while a person is on pregnancy/maternity leave

Last amended 
15 August 2017

Incapacity payments continue to be paid during maternity leave for the period of "confinement" i.e. six weeks either side of the expected/actual birth date, if payments would have continued if not for the maternity leave. Payments continue at the established rate of compensation i.e. payment calculations continue to include hours and earnings as if the person was actually working during the period.

During the 12 weeks period of "confinement" the number of hours worked for the purposes of the "adjustment percentage” in section 19(3) (SRCA) and 131(MRCA) should be the percentage that would have applied were it not for the maternity leave i.e. treated similarly to a period of paid recreation leave or long service leave (LSL), see section 8.10. Similarly AE is set at the amount the person would have earned if not for the maternity leave. In effect the person is ‘deemed’ with an AE during the period.  

In some cases the person may take other paid leave such as LSL and recreation leave in conjunction with the maternity leave, see section 8.10.

8.9.1 Person chooses not to return to work after the confinement period

If at the end of the confinement the person chooses not to return to work, and the same level of incapacity would have continued, incapacity payments are calculated as if the person had returned to work, though the hours are set at 0.  The decision not to return to work does not in itself alter the underlying incapacity.  After the confinement period, payments are based on the actual hours the person worked (potentially nil) and any income the person continues to earn or would have earned (deemed) if they had returned to work.

Payments are not ceased on the basis that the person has made a choice not to return to employment after the confinement period but may be ceased for other reasons i.e. no continuing incapacity.

Further issues to consider which may affect the level of compensation are:

  • Is the medical and other evidence concerning the person's full work potential sufficient? Is the deemed AE at an appropriate level?  Is the incapacity continuing? This should be reviewed at the end of the 12 weeks and then periodically.

  • Does the person’s choice to leave the workforce materially affect the ability to provide rehabilitation support aimed at increasing the AE?  Is it realistic to consider providing additional rehabilitation?  If so, is the person able and prepared to comply with attempts to provide that rehabilitation?

8.9.2 Rehabilitation after confinement period

If the person is actively participating in an open return to work (RTW) rehabilitation plan after the 12 week confinement period, AE should be only be the amount the client actually earns. This will include any amount of paid maternity leave. The person should not be deemed with an ability to earn on an assumption that they will no longer be actively participating in rehabilitation. Instead the delegate must consider if the person is continuing to remain compliant with the rehabilitation plan.  

8.9.3 Payments received under the Paid Parental Leave (PPL) Scheme

The paid parental leave (PPL) scheme provides for 18 weeks’ pay at the national minimum wage.  Payments under this scheme are not earnings derived from employment and cannot be considered as actual earnings and therefore have no direct impact on the level of incapacity payments.  However the policy is that we will only allow exemption from participation in the workforce or rehabilitation for the 12 week period.