Why Six Month Paid Maternity Leave Is Still A Distant Dream For Many

Activists are asking for a mechanism where the government can create a social security fund, from a tax levied on both workers and employers.

New Delhi: Six and a half months of maternity leave for women in the organised sector is now a reality after President Pranab Mukherjee gave his assent to the Maternity Benefit (Amendment) Act, 2017 last week.

The critics have pointed out that women in the informal sector, who form 95 per cent of the workforce, have been left out. Even within the formal sector, paid maternity leave is still a distant dream for many women, they say.

When 30-year old Development Professional Sukriti announced her pregnancy, her employers tried changing the terms of her contract.

She recalls that there was a lot of apprehension and suspicion when she broke the news about her pregnancy.  Her employers asked her why she didn’t tell them about her pregnancy earlier.

“They wanted to hire me on a consultancy basis. On paper, it would mean that they don’t have to pay me during the six months of maternity leave at all,” she said.

While a majority of established companies offer paid maternity leave; according to the law, smaller companies, including start-ups, are not geared towards life events experienced by their employees.

The owners of small companies say the government’s recent move to double the paid maternity leave to six and a half months for companies employing more than 10 people will be a financial burden.

Onkar Khullar, founder of a start-up ‘I Impact India’, said that younger companies have little resources to spare.

“For a start-up like us, if you have someone who is going to have a child, their minimum pay grade would be Rs 40-50,000 a month. Rs 50,000 for six months means Rs 3 lakh,” he said, adding, “since I will have to hire a replacement too, so at the end of the day, I will end up paying Rs 6 lakh. This is twice the amount for the same work. That’s a bad idea.”

“We’ll start hiring people on contractual basis because then maternity and insurance are not valid. Nothing against the women, but this is just a business decision,” he added.

This trend of contractual employment is already evident in the increasing informalisation of jobs in the formal sector.

According to search results, only 17 per cent of the total workforce is employed in the organised sector and over half of them are employed  informally.  Only a 8 per cent of the total workforce has access to social security benefits like paid maternity leave.

The existing law places the responsibility of providing six months’ paid maternity leave on the employers, but activists believe this may discourage employers from hiring women.

Activists are asking for a mechanism where the government can create a social security fund, from a tax levied on both workers and employers. The proposed fund could finance the paid maternity leave and ensure it just doesn’t remain a law on paper.

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  2. Khullar is right. Typical government policy of one size fit all just does not work with the ground reality. In principle even if I agree that a lady should get sufficient maternity leave, this policy will surely have an impact when I am hiring someone. In effect the law will have a detrimental effect on the employability of women candidates in smaller companies.

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