As the saying goes, "a happy employee is a productive employee," and when it comes to the happiness and well-being of employees, maternity leave can make all the difference. Providing maternity leave is not just about fulfilling a legal requirement or ticking a box on a compliance checklist, but a crucial factor for employee health, positive morale, higher retention rates, increased productivity, and even company loyalty.
With the increasing trend of remote working and international startups hiring employees from all over the world, it's essential to have a good understanding of the maternity leave regulations in different countries, particularly in India. With its large population of English-speaking, highly-educated professionals, the country has a rich pool of top talent.
Below, we explore how maternity leave works in India, including how long it is and the legal requirements for compliance.
Overview of Maternity Leave Policies in India
The Maternity Benefit Act, 1961, governs maternity leave regulations in India and covers all establishments that employ 10 or more people. However, it doesn’t apply to women who are self-employed and those who work for establishments that have less than 10 employees.
India’s Maternity Benefit Act has been updated several times to safeguard and protect the interests of female employees. The last amendment was in 2017, and it gave rise to the Maternity Benefit (Amendment) Act 2017, which increased maternity leave duration to 26 weeks — that’s a 116% increase from the original 12 weeks. That said, the 26-week maternity leave policy only applies to mothers who are having their first or second child. After the second child, mothers only get 12 weeks of leave.
To be eligible for maternity leave in India, an employee must have worked in an organization for at least 80 days in the 12 months preceding their expected delivery date. Maternity leave benefits are available to all employees who meet this criterion, regardless of whether they are permanent, temporary, or contractual.
Although maternity leave can be unpaid, the Maternity Benefit Act mandates that all female employees in India be paid during their maternity leave. The rate of pay is based on the employee's salary and is meant to be equal to their average daily wage. In other words, the employee gets paid 100% of their base salary while on leave.
It’s also worth noting that in India, maternity leave is not just available to pregnant women. Other employees who meet the motherhood eligibility criteria are also entitled to the benefit:
- Women adopting a child
- Surrogate or commissioning mothers
- Women who experience a miscarriage
There are some limitations, however. In the event of a miscarriage, an employee is entitled to six weeks of paid leave. And while biological mothers get 26 weeks of maternity leave, commissioning mothers only get 12 weeks as do adoptive mothers, and only if the adopted child is below three months of age.
Maternity Leave In India: Timing and Documentation Requirements
When it comes to providing maternity leave, it’s important to keep some timing issues and documentation requirements in mind.
For the 26-week maternity leave, employees get a maximum of eight weeks before the expected delivery date and up to 18 weeks after childbirth. If the employee is bearing a third child, their pre-delivery leave can only last a maximum of six weeks, with the other six weeks taken after the child is delivered.
Although a lot of mothers choose to take some time off before delivery, they don’t necessarily have to use their maternity leave this way. They can, for example, elect to take all their maternity leave days after their child is born.
To be able to claim maternity benefits, pregnant employees will have to:
- Give a written notice to the employer stating their claim for maternity benefits and the amount to which they may be entitled under the Maternity Benefit Act
- State the expected delivery date and the date from which they will be absent from work, which will not be a date earlier than six weeks from the date of expected delivery. The notice should also include maternity leave duration and the expected date of return to work.
Each company is different, and how early an employee must provide notice depends on the specific HR requirements. For some, this could be at any point during the second trimester, and for others, it’s no later than eight weeks before the intended leave start date. Ultimately, it’s a good idea for employees to give their notice as soon as possible to make it easier to plan the workflow, including finding and training a replacement.
Supplementary Benefits for Women Taking Maternity Leave
In addition to paid maternity leave, employees in India can also receive standard employee benefits throughout the duration of their leave. This includes benefits, such as housing allowance, medical insurance, help with some bills, as well as other company allowances and perks.
Expecting mothers in India are also entitled to reduced workloads from 10 weeks before their due date. During this time, a pregnant employee can’t stand for long hours, undertake any arduous work, or be asked to do any work that may cause physical problems.
After the mandatory 26 weeks of leave, employees can take advantage of a work-from-home provision under the Act. Of course, how someone uses this option will differ depending on the nature of their work and what has been agreed upon with the employer.
Furthermore, employees can extend their leave, but this is usually unpaid unless it’s a special case, such as in the event of a medical reason. In this instance, the person will be entitled to an extra 30 days of paid leave, provided they submit all medical documents to the employer.
How India Maternity Leave Compares to Other Countries
Maternity leave policies vary significantly across different countries, however, a common trend across many countries is the need to support working mothers by providing adequate leave. It's also essential to note that maternity leave policies are continually evolving, and there is increasing pressure on governments worldwide to provide more comprehensive support to working mothers.
India's maternity leave policy of 26 weeks of paid leave is in line with international standards, but many other countries offer more generous policies.
For example, in the United Kingdom, female employees are entitled to up to 52 weeks of maternity leave, with the first 26 weeks being ordinary maternity leave, and the remaining 26 weeks being additional maternity leave. Employees are entitled to receive up to 39 weeks of statutory maternity pay, which is paid at 90% of their average weekly earnings for the first six weeks, followed by a fixed weekly rate for the remaining 33 weeks.
In comparison, the United States does not have a federal law mandating paid maternity leave, and it's left up to individual employers to decide their policy. The Family and Medical Leave Act (FMLA) of 1993 allows eligible employees to take up to 12 weeks of unpaid leave for the birth or adoption of a child. However, this policy only covers around 60% of the workforce, and there is no legal requirement for employers to provide paid leave.
In a place like Australia, employees are entitled to up to 18 weeks of paid maternity leave at the national minimum wage. This leave is available to full-time, part-time, and casual employees who have worked for the same employer for at least 12 months. Employees are also entitled to unpaid parental leave for up to 12 months, which can be taken after maternity leave.
Each country has its own rules and norms about maternity leave, which can become confusing, especially if you’re trying to build a global business. Nonetheless, it’s important to be able to keep up with all the laws, including in India. This cannot be overstated since the country has well-mapped-out maternity rules, and employers who fail to comply with these regulations can face serious repercussions.
Ensuring Legal Compliance with India’s Maternity Leave Rules
The Maternity Benefit Act outlines strict penalties and fines for non-compliance, including:
- Monetary penalties: Employers who fail to pay their employees' maternity benefits may face a fine of up to INR 5,000. Additionally, those who violate any provision of the Act may also be fined up to INR 50,000.
- Legal action: Employees who are denied maternity leave or other benefits may file a complaint with labor authorities. If the complaint is found to be valid, the employer may be ordered to pay the employee's maternity benefit and other damages.
- Imprisonment: In extreme cases of noncompliance, employers may face up to three months in prison. This penalty applies if an employer denies maternity leave to an employee or terminates their employment during the maternity leave period.
While the penalties are serious, the risk of non-compliance need not be a problem for employers. As long you conduct sufficient research and understand the Indian legal climate, you should be able to go through with hiring and onboarding remote employees from India with relative ease. Better yet, you could partner with an Employer of Record (EOR) to take care of the compliance, so you can focus on other business areas. RemoFirst allows you to do just that.
We help you employ workers in India without violating employment laws and definitely without you having to go through the long and often costly process of setting up your own fully compliant entity in India. We’ll help you take care of everything from employee onboarding to handling international payroll and benefits, such as maternity leave. The best part is that we help companies do this in a cost-effective and efficient manner.
Check out our guide to hiring talent in India to learn more about how we can help you take the hassle out of attracting and retaining the people who will help your business grow.
