What Has Changed & Why It Matters

What has changed:

• The law amends the Fair Work Act 2009 to prohibit an employer from refusing or cancelling employer-funded paid parental leave (PPL) for an employee if their child is stillborn or dies, provided the employee would have been entitled under the terms and conditions of employment if the child had been born alive. 
• It applies where:
  • The leave is associated with the birth of the employee’s child or that of their spouse/de facto partner, or the placement of a child for adoption. 
  • The stillbirth or death occurs on or after 7 November 2025. 
• The Bill passed Parliament on 3 November 2025 (House & Senate) and received assent shortly thereafter. 
• Importantly: The law does not force an employer to provide paid parental leave if they did not already do so; it simply protects the entitlement when employer-funded PPL is already provided. 

Why it matters for HR & employers:

• It fills a protection gap: previously unpaid parental leave (UPL) under NES was protected in stillbirth/child death cases, but employer-funded paid parental leave might be cancelled by employers in some cases. This law aligns PPL with the protections already in place for UPL. 

  • By ensuring alignment, Baby Priya’s Law strengthens protections and reduces compliance risk. HR teams referencing NES standards can review more detail here: Fair Work Ombudsman – Parental Leave

• It has reputational, compliance and risk implications: if an employer cancels PPL in these circumstances, it may breach the Act and attract civil penalties. 
• From an HR perspective, it signals the need for compassionate, clear policies around parental leave, bereavement, stillbirth and infant loss. For SMEs especially, having compliant, fair, and transparent processes is a differentiator.

Key Obligations & Considerations for Employers/HR

Here are the main obligations and issues your HR or policy team should focus on:

1. Policy & Contract Review
   • Review your employer-funded paid parental leave policy and employment contracts (or enterprise agreements) to confirm whether they address what happens in the event of stillbirth or infant death.
   • If your terms or policies currently say “leave may be cancelled if the child is stillborn or dies”, that clause will be overridden (unless it is a term “expressly agreed” before 7 Nov 2025). 
   • Ensure that any communications to employees reflect the new position.
   • Where your policy is silent, the new law will apply, so HR needs to check for “silent or unclear” provisions. 
2. Implementation Date & Coverage
   • The protection applies to stillbirth or child death occurring on or after 7 November 2025. 

     • Employers can reference the original amendments and commencement dates in the parliamentary records here: Parliament of Australia – Bill Information

   • For events before that date, the previous arrangements apply (unless your organisation had stronger internal policy).
   • Make sure management and payroll understand the date and how to interpret it in leave cases.
3. Exceptions to the Protection
   • Terms and conditions of employment may expressly provide that employer-funded PPL can be cancelled/refused in the event of stillbirth/child death, this remains an exception. 
   • If the employee is covered by another leave entitlement (other than UPL or compassionate leave) that explicitly addresses stillbirth/child death, the new protection may not apply. 
   • An employer cannot unilaterally vary the terms after 7 Nov 2025 to avoid the protection. 
4. Communication & Training
   • Managers and HR must sensitively handle situations of stillbirth or infant death, the law underscores the need for compassionate treatment.
   • Document processes: who deals with leave requests, what forms or evidence are required, how the policy applies.
   • Consider briefing payroll and HR advisors so they understand the new legal threshold and do not inadvertently cancel leave incorrectly.

Conclusion

The Fair Work Amendment (Baby Priya’s) Act 2025 is a significant, compassion-driven reform in Australia’s workplace relations landscape. For HR teams and employers, the message is clear: review your employer-funded paid parental leave provisions, ensure policy alignment, communicate changes clearly, and handle situations of stillbirth or infant death with empathy and compliance.