Understanding Maternity Leave Pay: What Does "Average Daily Wage" Include in Practice?

Hi All,

I am working in an IT company. This is the first time that someone is taking maternity leave in my office. I have read the Maternity Benefit Act where it is written that during these leaves, the employee needs to be paid at the rate of "average daily wage." I want to know what does this "wage" actually mean. Does it mean only basic pay? Or do other allowances also need to be paid?

Our salary breakup includes basic, HRA, medical allowance, conveyance allowance, and special allowance. Which components need to be paid during the 12 weeks of maternity leave?

I want to understand what the Maternity Benefit Act says. Additionally, could you please let me know what is practiced in your company, as I am aware that not all private companies follow this law.

Please help, it's a bit urgent.

Thanks,
Peonka

Hi Peonka,

If the member falls under ESIC, then "Wages" means all remuneration paid or payable in cash to a woman if the terms of the contract of employment, express or implied, were fulfilled. This includes:

(1) such cash allowances (including dearness allowance and house rent allowance) as a woman is for the time being entitled to,
(2) incentive bonus, and
(3) the money value of the concessional supply of food grains and other articles, but does not include:
(i) any bonus other than incentive bonus;
(ii) overtime earnings and any deduction or payment made on account of fines;
(iii) any contribution paid or payable by the employer to any pension fund or provident fund or for the benefit of the woman under any law for the time being in force; and
(iv) any gratuity payable on the termination of service.

But in case the member does not fall under ESIC, then during the maternity leave, she would get her full salary for three months.

Attached are some docs for your assistance.

Dear Peonkasangeeta,

It is rightly said that she has forwarded a good collection. She is entitled to 84 days of maternity leave with full salary.

Thanks,
J. S. Malik

Dear Sangeeta,

Thank you for the information shared. I am Srinivas, working as an HR in an IT company.

When the employee is paid maternity benefits, such as her full monthly salary for 3 months, do you need to deduct PF from her salary? What happens to the Employer's PF contribution? Does the employer need to pay? What if the employee wants to extend her maternity leave (after 12 weeks) due to medical reasons, like weakness?

Regards,
Srinivas
09945827304

Dear employer,

The employer has to pay a contribution of 12%. It is a leave, and the full salary is to be prepared, so PF needs to be deposited.

Regarding the extension of leave, it is the management's choice to sanction or not to sanction.

Thank you.
J. S. Malik

If leave is extended beyond 12 weeks and the employee wants a further 4 weeks of leave, the company has agreed to provide leave without pay. My question is, what will have to be done for PF? Will it be paid at 12% of monthly salary, or not? Note that the employee will still be on the company's payroll.

Thanks,
Amarpita

Hi,

My company says they will only pay basic and HRA plus Rs. 250 as a medical bonus. Their justification is that she is entitled to only "average daily wages," which includes only the above and not medical allowance, conveyance allowance, and special allowance. Please advise.

Could you please clarify the maternity benefits for me?

Questions on Maternity Benefits

1. Who is covered under maternity benefits?
2. Is a person without ESIC eligible for these benefits?
3. How many days of service are required with the company to be eligible for this benefit?

Thank you.

I am working as an HR manager in an IT company. One of our employees is going to avail herself of maternity leave from the 1st of March 2013. Her salary increment is due in April 2013. My question is, which salary has to be paid during the 3 months of maternity leave (old salary or the new salary)?

Please guide me immediately.

Thanks & Regards,

S. Rathnamala [Phone Number Removed For Privacy Reasons]

I kindly request your assistance with the query mentioned below: If an employee does not fall under ESIC for Maternity Leave, is she still eligible for her performance incentives (variable component) in addition to her Fixed Salary?

Regards,
Rupali

I would like to know the pay during maternity leave. According to our company policy, 90 days of maternity leave is allowed to be availed. One of our employees took maternity leave and was on leave from December onwards.

Salary Structure

Her salary structure is as follows:
- Basic + DA: 24,600
- HRA: 8,200
- Conveyance: 800
- Medical Allowance: 1,250
- Other allowances: 6,150

Her monthly CTC is 41,000. I am a bit confused about the maternity payment since the previous HR in my company used to pay only the basic + DA for the maternity leave period. I would like to know the correct calculation that should be followed by an IT company in Kerala.

Hi,

I found that the salary is paid by the ESIC department and not by the company. ESIC has its own processes that both the employer and employee must be aware of. My small concern is - Is the salary for the maternity period paid in "one go," or is it "deferred," or is there any other mechanism for payment?

Applicability of Maternity Benefits (Amendments) Act, 2017 to Women Employees Covered Under Employees State Insurance Act, 1948

What is the definition of wages under the ESI Act for checking the Rs. 21,000/- threshold limit? Currently, CTC comprises Basic + DA + HRA + Commuting Allowance + Medical Allowance + Special Allowance + PF Contribution + ESI Contribution + Insurance cost, if any.

Will the full salary in hand be paid during maternity leave, and if yes, who will pay it—the employer or the ESI department? What is the defined procedure for claiming this?

What is the definition of "the average daily wage for the period of a worker's actual absence from work"?

Are facilities such as crèche and provision for work from home not available?

Thank you.

Hi,

If a woman is going for her 3rd child maternity leave, how many days of leave and what amount will she receive from her employer? Will it be based on the basic salary (per day wages) * leave days, or the gross salary (per day wages) * leave days? Kindly reply.

Thank you.

Dear all,

Maternity benefit comes under ESIC, and ESIC is applicable only for those who are earning below ₹21,000 as gross salary. Now, my question is, who will pay maternity leave wages for non-eligible ESIC employees? Can anyone suggest where this is mentioned? I am waiting for your valuable response.