On November 16, 2018, the Ministry of Labour and Employment, Government of India ('Ministry') proposed the Maternity Leave Incentive Scheme1 ('Scheme') whereby seven weeks' wages would be reimbursed to employers who employ women workers with a wage ceiling up to INR 15,000.00 a month (USD 209 approximately) and provide them maternity benefit of 26 weeks paid leave, subject to certain conditions.
In perspective, Maternity Benefit Act, 1961 (Act) was amended in 2017 (2017 Amendment), to enhance/ increase the maternity leave period to 26 weeks from the previous 12, for a woman employee, for the first two children. Since the 2017 Amendment was aimed to ensure the health of women employees pursuant to giving birth, and to ensure safety of the newborn child, it appeared to be a positive development for women employees in the private sector. However, it has been widely reported that there has been a shortfall in the implementation of the 2017 Amendment resulting in the amendments to the Act being inadequate and ineffective.
Sadly, a perception has surfaced whereby employers are not inclined to employ women as they would then be required to sponsor them for a 26-week long paid maternity leave. This point can be corroborated from a report of the World Bank, where it has been statistically provided that female participation in the labour force dropped to 27% in 2017 from 35% in 1990.2
Hence, the Scheme could be seen as the missing motivation for the private employers to hire women employees as partial cost being borne by the Government making it less financially challenging for the employers and gradually shedding the above prevalent notion.
Currently, the Scheme is in draft stage and more is yet to be seen. Nevertheless, the Scheme seems to be the apt step in line with prevalent global polices in countries such as Australia & Canada (benefits of maternity are entirely financed by public funds), United Kingdom & Singapore (shared responsibility on the employer and the Government to contribute to the wages disbursed on account of maternity leave), and South Africa (responsibility on three stakeholders – i.e. the employer, employee and the Government).
The proposed Scheme, if approved and implemented, shall ensure the women in this country an equal access to employment and other approved benefits along with adequate safety and secure environment. The work places will be more and more responsive to the family needs of the working women. There are some media reports that this Scheme has been approved/ notified. However, it has been clarified that Ministry is in the process of obtaining necessary budgetary grant and approvals of competent authorities.3
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