The amendments to the Maternity Benefit Act, 1961 came to effect from January 4th .2017 in India. This act protects the employment of women during maternity with full pay during their absence from work to take care of the child. This act is applicable to all establishments employing 10 or more persons. The major amendments brought to this act in 2017 are ; increase in maternity leave from existing 12 months to 24 weeks, 12 weeks paid maternity leave for adopting and commissioning mothers, work from home option and crèche facility at work places. This new amendments to the existing Maternity Benefit Act made India one of the progressive countries to adopt generous polices when it comes to gender sensitivity and diversity.
Currently, only 27% Indian women are in the labor force and every year more and more women are dropping out. This is worrisome and strange at the same time considering the fact that India is a growing economy. So the amendments to the Maternity Benefit Act was supposed to address the issue in hand and encourage more and more women participation in wealth creation to the families and to the economy. To be honest, when these amendments were brought in not many people were optimistic about its implications. Recently TeamLease, a reputed staffing solutions firm has released its research findings which says that the new bill may cause job loss of 11 lakh to 18 lakh in the year 2018-19 and this study covers 10 sectors. Though the intent behind this amendment is appreciable, its implementation could have been better.
So what are the issues and why an initiative which was supposed to help the women is becoming a bottleneck? Firstly, let us understand it is a cost. Paying 6.5 months' salary to an employee without any service is a huge burden. Somebody has to bear this cost. Is it fair to say the business itself has to bear this cost in total? Isn't the contribution from other stakeholders important to make this amendment work effectively? India is the only country where employer is asked to bear the burden completely, in other countries this cost is distributed to government, industry bodies, insurance companies etc. For big businesses it is still possible to adopt this new law but what about SMEs, startups and MSMEs? Remember, this act applies to all type of businesses. I work with many startups in research and consulting area and many of these businesses are worried that this is going to be tough for them. This will make businesses to not consider young women at the time of recruitment.
What could have been done better by the government?
First and foremost, before bringing the amendments discussion with all the stakeholders especially small businesses would have been made government empathetic towards the concerns of the other party. Secondly, six months leave shouldn't have been mandatory but flexible hours of working and crèche facilities would have been given more focus. For e.g. if a mother has no support system, even after six months of leave how will she come back to work? Establishing good crèche facilities would have been a good step. Even establishing crèche facilities will be tough for small businesses. Government , industry bodies and CSR funding could be considered for funding this cause. Flexible hours and work from home are also viable options. There are many sectors where this will work well. Incentivizing businesses who exhibit considerable efforts towards this cause can also help in implementing the rules more effectively.
In a large and diverse country like us where unorganized sector still contributes substantially to the economy, it doesn’t make sense to make a law like this mandatory. The best thing would have been to introduce the law and make it voluntary adoption for first few years. My institute had 6 months leave during maternity since many years. So there are few organizations who are committed to the cause and spreading awareness and explaining why this is important in the long run for the holistic development of our economy would have been made organizations to think positively. Sadly, this new law is making things worse for the women who are already dropping out of work force for various reasons.
Another question goes unanswered is why always consider only women in this? Shouldn't men playing their role as fathers by staying at home for few months and take care of the infants? Why all 6 months leave for women? Can't there be a system where this leave is split between mother and father. With this at least only women will not be put under disadvantage.
I am a strong advocate of economic empowerment for women. Me and my family have immensely benefitted because of my job and career. It makes me very sad to see a progressive law which was supposed to help women grow and achieve professional success has become a roadblock. It is scary to think millions of women will lose opportunity to work and earn because of this new law. I hope the concerned ministry realizes the issue and takes corrective measures. Also, industry bodies and women organizations should pitch in to deliberate on this so that some agreement can be reached on the issue.