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Maternity Benefit (Amendment) Bill, 2016: Needs Certain Amendments

The movement towards a more inclusive and diverse workplace is a progressive development. A major limb of this movement is the drive towards creating workplace policies that encourage more women to enter and more crucially, continue to be a part of the workforce. It is quite common to see women employees leaving employment after the birth of a child due to lack of a supportive environment, where balancing professional development and childcare becomes extremely difficult. This issue is compounded by the fact that the statutory benefits currently available in India are far behind international standards. There is an urgent need to understand this issue and explore feasible solutions, in the form of improved benefits. With an increasing number of women entering the workforce, there is a renewed focus on whether the benefits provided by existing legislations, such as the MB Act, encourage inclusivity. It has also often been highlighted that the 12 weeks of paid maternity leave provided under the MB Act falls short of the international standard of 14 weeks as set by the International Labour Organization. Given this, there has been a concerted push to amend the MB Act, with several ministries in the government coming up with proposals for change. In this background, President Pranab Mukherjee has given assent to the Maternity Benefit (Amendment) Act, 2017 that has made changes in some of the provisions of over 55-years old law entitling certain benefits to women employees. The Maternity Benefit (Amendment) Bill 2016 (MB Bill) to amend the Maternity Benefit Act 1961 (MB Act) was passed by the Lok Sabha (Lower House) on 9 March 2017 and was previously passed by Rajya Sabha (Upper House) on 11 August 2016. The basic aim is to ensure proper care of the newborn, the future citizen of India, right from the time of birth. The newborn should get the complete love and attention of the mother. That is how these children will become true assets of the country when they grow up. Mothers too will remain healthy.

KEY CHANGES:

The proposed changes under the Amendment are as follow:

Increase in the Duration of Paid Maternity Leave: From 12 weeks (of which not more than 6 weeks shall precede the expected date of delivery) to 26 weeks (of which not more than 8 weeks shall precede the expected date of delivery). A new provision has also been introduced, providing that a woman with two or more surviving children will receive only 12 weeks of paid maternity leave. Such a provision restricting the benefit available based on the number of children was present in a few States, under the Shops and Establishments Acts. This is now being made a part of the central legislation as well.

Surrogacy Leave: Paid surrogacy leave of 12 weeks from the date when the child is handed over. This leave can only be availed by a commissioning mother who uses her egg to create an embryo to be implanted in another woman.

Adoption Leave: Paid adoption leave of 12 weeks from the date when the child is handed over, provided the child is less than 3 months old.

Work from Home Option: Applicable after the period of maternity leave, on such terms as may be mutually agreed to between the employer and the woman.

Crèche Facilities: An obligation on employers with 50 or more employees to provide crèche facilities to women. While an earlier draft of the Amendment had proposed the distance from the workplace to the crèche to be one kilometer or less, the Amendment simply states that it will be as prescribed. We would need to wait for a subsequent government notification in this regard. The Amendment also does not make it explicit whether the crèche facility can be provided on a chargeable basis to employees or whether the facility has to be provided free of charge. Further, the Amendment also permits four visits per day to the crèche, which shall also include the interval of rest allowed to the woman employee. This appears to be in addition to the two nursing breaks that the MB Act already permits till the child is of 15 months of age.

Obligation to Notify: An obligation on employers to inform (in writing and electronically) to every woman newly appointed within the organization about the benefits available under the MB Act.

Unchanged Provision:

Several provisions of the MB Act remain unchanged which, inter alia, include the eligibility criteria for receiving maternity benefit under the MB Act. A woman who has worked for at least 80 days in the 12 months immediately preceding her expected date of delivery will continue to be eligible. Further, an employer will continue to be prohibited from employing a woman for a period of six weeks immediately following her delivery, miscarriage or a medical termination of pregnancy. In addition, while there were discussions in the Rajya Sabha on the idea of introducing parental leave, it did not result in any changes to the Amendment. Therefore, the statute will continue to deal with only maternity leave.

KEY CONCERNS

The proposed amendments have received mixed response from different sectors and industries. Large organizations have welcomed this move, and in fact, even before the Amendment, some employers have been proactive in extending maternity leave to their employees in excess of what the MB Act provides. This has been particularly true with employers in the IT – BPM sector. The additional benefits offered are not restricted to just a longer duration of maternity leave. Several employers have already recognized leave for adoption, for surrogacy, for expecting fathers, etc. Some have also taken the initiative to create unique policies that include sensitization programs for their workforce, flexible working hours, and tie-ups with child care vendors, etc.

However, there has also been pushback from micro, small and medium enterprises given that the increase in the duration of paid maternity leave will result in an increase in cost. Another common concern is the difficulties involved in providing a crèche facility close to the establishment – both in terms of cost and infrastructure. There is a real apprehension that placing such additional financial burdens on employers could even have the unintended consequence of potentially leading to a decrease in the recruitment of women employees.

Several expert bodies like the WHO have recommended that 24 weeks of maternity leave is required to protect maternal and child health. However, since the costs of this leave are to be borne by the employer, it may have an adverse impact on job opportunities for women. Various countries have implemented different funding models in relation to maternity benefits. In some countries the employer bears the cost, while in some others it is paid by the government. While women will be provided with 26 weeks of maternity leave for two children, the period of leave for a third child will be 12 weeks. This could affect the growth and development of the third born child.

The Act and Bill cover women workers employed in establishments with 10 or more employees, and other notified establishments. However, a majority of the women workforce, working in the unorganized sectors, may not be covered. There are several labour laws that provide maternity benefits to women in different sectors. These laws differ in their coverage, benefits and financing of such benefits. However, a woman with already two or more children is entitled to 12 weeks’ maternity leave. The prenatal leave in this case remains six weeks.

The Act also provides for adoption leave of 12 weeks for a woman who adopts a child under the age of three months. A commissioning mother is also entitled to a 12-week leave from the date the child is handed over to her. A commissioning mother is defined as “biological mother who uses her egg to create an embryo implanted in any other woman” (the woman who gives birth to the child is called host or surrogate mother). Female civil servants are entitled to maternity leave for a period of 180 days for their first two live born children.

The Indian government’s new maternity bill, which comes into force this week, has been branded an elitist policy that will do little or nothing to help the vast majority of the country’s mothers. According to women’s groups, the new rules – which raise maternity leave from 12 to 26 weeks, putting India ahead of France and the US – will apply only to a small fraction of the female workforce. It’s as if, for the government, 95 per cent of India’s women don’t even exist. The extension will only apply to women in the formal sector, which amounts to just 5 per cent of India’s working women.

Internationally, the bill has been touted as a success for India, which has one of the world’s lowest female employment rates, nearly one fourth and mothers often feel under pressure to leave their jobs after having children. A headline in Fortune magazine said India’s move puts the US to absolute shame. But most Indian women will never reap the benefits, according to the International Labour Organization. India’s informal economy is huge; it employs over 435 million men and women who never see the benefits of government laws. In the informal sector, you never have to sign a formal employment contract and your relationship with the employer is unclear. For example if women work as maids – and up to 10 million Indian women work as domestic cleaners or cooks – they will not have signed a contract. They have a verbal agreement, so in reality they are not really covered by formal rules and are not recognised by law.

Those working in the informal industries are among the most vulnerable. They have problems. If a woman gets pregnant, she has to find a temporary replacement for herself, like a sister or a sister-in-law. Otherwise, she loses the job. The bill did little to resolve the problems of working mothers. According to the new law, workplaces are supposed to provide crèches on site, and women are supposed to be able to go see their babies four times a day, but in practice that doesn’t happen. The facilities provided are unclean and low quality, women don’t feel comfortable leaving their babies there. Women are very afraid to leave small babies there, and so they just leave after pregnancy.

A quarter of women in India don’t return to work after having their babies’ revealed ACCI survey. Reducing that number could increase India’s national income by 27 per cent according to the International Monetary Fund.

But increasing female participation in India is complex. Maternity benefits may make women more willing to work, but they also make employers less willing to hire them.

India is still a developing country. Countries like Norway can afford to give mother a year’s maternity leave now but they didn’t have that while they were still developing. LocalCircles, a citizen engagement organization that surveyed more than 4,000 small businesses about the new maternity rules, revealed that 26 per cent of firms would favour men over women because of the new rules. There is a lot of political correctness on hiring for diversity. There is lot of difference between Karni and Kathani. Many people say something and do the opposite. The fact is that business dynamics will take over politically ‘right’ things. Now businesses are looking at women and thinking has to pay two persons’ salary for one person’s work. Now employers will not just look at women’s qualifications and capability but also the fact that they come with an additional cost.

One solution would be to introduce paid paternity leave. When an employer is deciding between a man and a woman, the burden of parental leave should be equally shared. The government hasn’t put in place proper childcare infrastructure for women, and instead has passed that burden on to employers. Women still feel taking any time off would have a negative impact on their careers. Six months is a long time in today’s world, with automation and artificial intelligence. Mothers already feel they need to be reskilled after taking that much time off. The law was a step in the right direction despite its limitations. Women bring as much skill and talents to the table as men do. They go to the best schools, best colleges and as talented and skilled as men are. Why should they be excluded? In the UK, when they introduced the Equal Pay Act, the same argument was made. But actually studies have shown that it has not made employers less willing to hire women.

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Dr Gursharan Singh Kainth

Director, Guru Arjan Dev Institute of Development Studies.
A recipient of Cultural Doctorate of Philosophy of Economics from USA. He is an active member of various professional bodies, namely –

He participated and presented papers in various International/national/regional seminars, conferences etc.. He remained member of the Academic Council of Punjab Technical University, Jalandhar. An unwearied researcher has about 200 research papers published in various international and national journals of repute and 15 research monographs to his kitty.  Besides, he has authored/co-authored /edited 15 books which have been well received and highly acclaimed during his three decades of professional career. He was honoured by various national and international awards, namely, Guru Draunacharya Samman, Vijay Rattan Award and so on. 

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