Premature births: A guide for NZ employers
The arrival of a premature baby brings a unique set of challenges for new parents. Between hospital stays, medical concerns, and adjusting to parenthood earlier than anticipated, many parents need additional support and understanding during this stressful time.
In New Zealand, approximately 10% of all births - around 6,000 babies - are premature each year. Of these, about 1% are born very premature (before 32 weeks), often requiring extended neonatal intensive care unit (NICU) stays and specialised medical attention.
Statutory entitlements
A baby is considered premature if it is born earlier than 37 weeks of gestation. New Zealand law provides specific entitlements to support employees who experience a premature birth.
Preterm baby payments
Eligiblity
Employees who qualify for government-paid parental leave (PPL) are eligible for preterm baby payments at the same rate as their PPL. The rate is currently capped at $754.87 gross weekly (as of 1 July 2024).
In New Zealand, parental leave eligibility is based on the baby’s expected due date, not the actual date of birth. To qualify, an employee must have worked at least 10 hours per week for any 26 of the 52 weeks before the due date. This standard applies whether the baby is born early or full-term. A recent case highlights the strict enforcement of this criterion.
Key details about preterm baby payments
Payments start immediately from birth or when the employee becomes the permanent primary carer for a preterm baby.
Available for a continuous period of up to 13 weeks.
Payments end on the date that would have been the start of week 37 of the pregnancy had the baby not been born early, or earlier if the employee returns to work or stops being the primary carer of the child (unless they are the person who gave birth to the child).
If an employee is already receiving PPL and has a premature baby, they can:
Pause their regular parental leave payments.
Start receiving preterm baby payments instead.
Resume their regular parental leave payments once the preterm payments end.
Employees must contact the IRD directly to arrange this transition.
It's important to note that employees can return to work between the end of preterm payments and the start of regular parental leave payments if they choose to do so.
Applying for preterm baby payments
The application for preterm baby payments is completed using the same process and form as paid parental leave payments. This is done via the employee’s myIR account.
Eligible employees must apply for preterm baby payments before their baby’s first birthday or before they have had permanent primary responsibility for a child under 6 years for 12 months.
It is especially important for employees to clarify the specific payment periods to ensure accurate processing of both preterm baby payments and regular parental leave payments.
Additional keeping-in-touch (KIT) hours
Employees receiving preterm baby payments have access to additional KIT hours during the preterm baby payment period.
The total extra KIT hours = 3 hours per week multiplied by the number of weeks they receive preterm baby payments.
If an employee exceeds this limit, they are considered to have returned to work, and any further payments may need to be repaid.
These additional KIT hours do not affect the employee's ability to receive regular parental leave payments or use standard KIT hours during their parental leave.
Financial support options
Beyond the preterm baby payments, parents of premature babies may be eligible for additional support:
Travel Assistance from the Ministry of Health: Many NICU parents are entitled to Travel Assistance, a payment that helps to cover the costs of mileage, public transport, taxis, etc. The form needs to be signed by a nurse every time the parent visits the hospital, so advise employees to see the support worker as soon as possible to get the paperwork.
Accommodation assistance: Some hospitals provide accommodation for parents of babies in NICU, particularly when they live far from the hospital.
Example scenario
Situation: Emma's baby was due on May 1, but was born prematurely on February 15 at 32 weeks’ gestation.
Preterm payment period: February 15 to March 29 (6 weeks, which is the period from birth until what would have been the end of 36 weeks of gestation)
Additional KIT hours: Emma is entitled to 18 extra KIT hours (6 weeks × 3 hours)
Regular parental leave: After March 29, Emma's regular 26 weeks of paid parental leave can begin.
Best practices for supporting employees
Supporting primary carers and partners with premature babies requires special consideration:
Flexible communication: Establish how and when the employee would like to be contacted
Gradual return plan: Work with the employee to create a phased return to work, if desired
Workspace accommodations: If employees return to work while their child is still in the hospital, offer private spaces for expressing breast milk or taking calls with healthcare providers
Resource connections: Provide information about support organisations for parents of premature babies, such as the list detailed on the Small Babies website.
Creating a supportive policy
Consider offering additional paid or unpaid leave beyond statutory requirements.
Primary carers: Some employers offer to top-up the preterm payments in addition to any employer-paid primary carer leave.
Partners: Unlike primary carers, partners have no statutory entitlements to additional leave, paid or unpaid, for preterm babies. While we know many employers provide support on a case-by-case basis, consider formalising this in your parental leave policy.
For further enquiries
While we work to keep our information current, the last word lies with the relevant government agencies:
Contact Inland Revenue (IRD) about government-paid parental leave and preterm payments, including payment eligibility, keeping-in-touch hours, application processes, rates, or transferring payments.
For everything else related to parental leave entitlements, contact the Ministry of Business, Innovation and Employment (MBIE) through Employment New Zealand.
Want to model the investment needed to provide paid leave to parents of preterm babies at your organisation?
Now for the important legal part: The information we provide is general and not regulated financial advice for the purposes of the Financial Markets Conduct Act 2013. Please seek independent legal, financial, tax or other advice in considering whether the content in this article is appropriate for your goals, situation or needs. The information in this article is current as at 11 May 2025.
Stephanie Pow
Founder & CEO of Crayon
