The government will have to work out distribution of financial burden on the employer, to ensure the mandatory nature of the amendment is met.
India’s total population in 2017 is a total of 134 crores, and although, China has been the most populous country in the world for decades, India is all set to overtake it in 2030 with a population of 1.53 billion.
While the country races at breakneck speed to create human capital, (with 50% of the above number aged between 0-25 years) it is fraught with cultural and societal paradoxes, resulting in holding back the female populace of 65.2 crores from achieving their fullest potential.
This schism is emphasised by the World Bank in its India Development Report released in May 2017, which states that India had one of the lowest female participation in the workforce, ranking 120th among 131 countries for which data was available. Even among countries with similar income levels, India is at the bottom, together with Yemen, Pakistan and Egypt and that the numbers are declining since 2005.
The report goes on to state that at 42%, India has some of the highest share of graduates in science and technology among the comparator countries like Indonesia or Brazil, but only 34% of women with a post-secondary degree are in the labour market. Only three of every five prime working age Indian women (26-45 years) are not economically active, meaning that they are neither working on a farm or in businesses nor are they earning any wage.
This, the report highlights, is a matter of concern, as women’s paid employment is known to increase their ability to influence decision-making within the household, and empower them more broadly in society as a whole.
It concludes that India’s potential GDP growth can go up by a full percentage point if half the gap in female labour force participation rate with Bangladesh or Indonesia, is closed, with the key to close the gender gap being to create more jobs, especially regular salaried jobs that are flexible and can be safely accessed by women.
Journalist Namita Bhandare, in her series ‘India’s declining female labour force participation’ writes that more Indian women would seek employment if they found reliable caregivers. She inter alia reports that a survey of women in Rajasthan’s Udaipur district found that mothers with children in the one-to-six-year-old age group spent 9.4 hours a day on household chores.
However, the recent 2017 amendment to the Maternity Benefit Act of 1961 (Amendment) – which entitles women to a ‘maternity benefit’ – i.e. full paid absence from work – to take care for her child) – is a step forward in the right direction towards increasing gender diversity at the workplace.
Women employed in factories, mines and plantations, government establishments, or employed for the exhibition of equestrian, acrobatic and other performances; and working in any ‘shop and establishment’ (i.e. any place of business which employs ten or more persons in the preceding 12 months) were already covered by the Maternity Benefit Act 1961. But now vide this Amendment, they will be eligible for paid maternity leave for an enhanced period of upto 26 weeks as against the earlier prescribed 12 weeks, of which 8 weeks can be availed before and 18-weeks post childbirth. Women who are having their third child can avail leave for 12 weeks, i.e. six weeks before and six weeks post childbirth.
The Amendment goes a step further and recognises the rights of an adoptive mother (who legally adopts a child below the age of three months) and a commissioning (i.e. a biological mother using surrogates) mother and entitles such a mother, 12 weeks of maternity leave, from the date the child is handed over to her. Moreover, the ministry of labour and employment clarified that this benefit extends to women whether they are permanent, contractual or consultants, in the organised or the unorganised sector, as well as to those women, who are already on maternity leave at the time of enforcement of the Amendment.
Also read: Why Indian Workplaces Are Losing Women
Post the 26 weeks leave, the Amendment introduces the option of work from home, if the nature of her job permits and she and her employer mutually agree the terms thereof.
More importantly the Amendment obligates from July 1, 2017, all organisations having 50 or more employees to provide a crèche facility within a specified distance as well, with four permitted visits per day.
Proeves, a pro-woman initiative that provides end-to-end childcare and parental support in its ‘Managing the Maternity Benefit Amendment Act 2017 Survey’ inter alia states that childcare is the top reason why women leave the workforce and the number 1 enabler that women want from their employers. This survey finds that with the extended maternity leave benefit period, India now qualifies among the 16 countries having the longest paid leave for new mothers, ensuring an adequate resting break for the body and mind to recover. The Act makes it mandatory for all employers to make their employees aware of their rights and the same can be done via town halls, making it part of the intranet policies or even putting it as part of their appointment letter.
The Proeves survey goes on to record that countries like Singapore which have 16 weeks of paid leave (eight are funded by the employer and remaining eight through public funds) whereas, in Australia, Canada the respective maternity leave of (18) and (17) weeks is paid by public funds. In India, the maternity leave funding is an investment into gender diversity that companies are mandated to make. This makes the cost of post maternity loss incredibly high for companies in India.
In order to ensure that the mandatory nature of the Amendment is not self defeating in the purpose of increasing gender diversity, thereby risking decline in hiring of women workforce, the government may have to put on its thinking cap on how to distribute/reduce the financial burden on the employer. It could do this perhaps giving tax benefits to companies to implement and incentivise this much needed boost to women empowerment at work – and in society – and address other important milestones to be covered – such as introduction of paternity leave which is a crucial piece missing from this progressive legislation.
Sayali Pathak is an independent legal counsel and former senior vice president legal with Bharti Airtel.