Well, have managed to sort it out with my employer and they are now happy to pay out my annual leave a before I go on extended leave and start getting PPL. I emailed DOL and got this reply this morning - in line with what Febgirl was explaining.
Thank you for your enquiry regarding taking annual leave before parental leave.
The requirements under the Parental Leave and Employment Protection Act - (the Act), provides that the paid parental leave payments start when an employee starts their parental leave.
Under the requirements of the maternity leave provisions under the Act Section 10 it states that maternity leave shall begin on the date of confinement, or when you go into hospital: or, in the case of adoption, on the date on which the female employee first assumes (with a view to adoption by her or by her and her spouse jointly) the care of the child, or, on an earlier date as agreed between employer and employee. What this may mean is that while you are on annual leave and your baby is born that you would have to cease annual leave and go onto parental leave, which would mean that the payments would begin from that date.
However, if you do not take Maternity leave under these provisions and agree with the employer to take the annual leave then start on the extended leave if you meet the eligibility criteria for this provision, then you could take all the annual leave agreed, go onto extended leave and the paid parental leave payments start from when you start your extended leave.
For details of eligibility criteria go to http://www.ers.dol.govt.nz/parentalleave/employees/who-can-take-print.html
I trust this information is of assistance. Should you required any further information please contact us on 0800 20 90 20.
Hope that helps someone else.