Preheat oven to 300°; grease a 12 x 8 inch baking dish (preferably nonstick or Pyrex) with 1/2 tablespoon oil.
Arrange half the potatoes in a slightly overlapping layer in the bottom of the dish; then sprinkle with salt and pepper.
Scatter the onion and bay leaves over the potatoes; arrange the remaining potatoes over the onion, sprinkling again with salt and pepper.
Drizzle the remaining oil over the potatoes.
Bake, uncovered, for 30 minutes; turn the potatoes with a spatula; cover the dish loosely with foil and cook 20 minutes until the potatoes are almost tender.
Increase oven temperature to 450°; sprinkle the sherry over the potatoes; cover again loosely with foil, and bake until the sherry is absorbed and the potatoes are tender, about 10 minutes.
Sprinkle with parsley before serving.