Maternity Benefits Act-2016

Lok Sabha recently passed the Maternity Benefit (Amendment) Bill, 2016. It will improve the maternity benefit to woman covered under the terms of the Maternity Benefit Act, 1961, from a period of 12 weeks to 26 weeks, for up to two surviving children. In this article, we review the highlights of the Maternity Benefits (Amendment) Act of 2016.

Maternity Benefit Act, 1961

The Maternity Benefit Act, 1961, regulates the leave and maternity benefit provided to women during employment for the period before and after child birth. Adherence to the Act is mandatory for factories, mines, the circus industry, plantations and shops or establishments employing 10 or more persons, apart from the employees who are covered under the terms of Employees State Insurance Act, 1948. The 44th Session of Indian Labour Conference (ILC), recommended improving maternity leave under The Maternity Benefit Act, 1961 from the current 12 weeks to 24 weeks. This recommendation was again reiterated during the 45th and 46th Session of ILC. Thus, based on the recommendations of ILC, requests from the different quarters, and the deliberations during the Tripartite Consultations with stakeholders, the centre has decided to amend the Maternity Benefit Act, 1961 and introduce the Maternity Benefits Act, 2016.

Highlights of the Maternity Benefits Act, 2016

The Maternity Benefits Act 2016 is applicable to women workers who are employed in establishments with 10 or more employees. Different countries have practised various funding models with reference to maternity benefits. In some countries, the employer bears the cost, while in certain others, it is paid by the government. In India, the employer bears the cost of Maternity Benefits provided to women workers. Since a majority of the women workforce in India are employed in unorganized sectors and small businesses with less than 10 employees, a major chunk of women workers are left uncovered. Expert bodies like the World Health Organization have always made recommendations that 24 weeks of maternity leave is necessary to protect maternal and child health. However, since the costs of this leave are to be borne by the employer, it has an unfavourable impact on job opportunities for women. Hence, care had to be taken while drafting the Act, to ensure that both the employer and employee have a fair standing under the Act.

Maternity Benefit

Under the new Act, as amended, the maximum period of maternity benefit has been increased from the current 12 weeks to 26 weeks in the case of women who have less than two surviving children. For women having two or more surviving children, the existing period of 12 weeks maternity benefit would continue. Further, a maternity benefit of 12 weeks would be made available to a 'commissioning mother' - the biological mother who utilizes her egg to generate an embryo implanted in any other woman. Also, for the 'adopting mother', a maternity benefit of 12 weeks is provided if she adopts a child below the age of 3 months from the date the child is handed over.

Creche Facility

This Act makes it obligatory for an establishment with fifty or more employees to have creche facilities, either individually or as a shared common facility, within a 500-meter radius. Further, the mother is also permitted four daily visits to the creche, inclusive of an interval for rest.

Work from Home

This Act also officially recommends employers permit women employees to work from home for some time after childbirth. Though the Act does not mandate the employer to allow work from home for women employees, it recommends work a work-from-home facility after childbirth for women workers and allows the employer/employee to decide on a duration for allowing work-from-home facility.

Appointment Letter

The Maternity Benefits Act requires all establishments to inform in writing and electronically (appointment letter) to all woman employees during the time of their appointment about the benefits available under the terms of the Maternity Benefits Act, 2016.

Company Registration

OPC Registration