Section 12 of the Maternity Benefit Act has your answer to some extent. The same is reproduced here for your reference:
"12. Dismissal during absence of pregnancy.—(1) When a woman absents herself from work in accordance with the provisions of this Act, it shall be unlawful for her employer to discharge or dismiss her during or on account of such absence or to give notice of discharge or dismissal on such a day that the notice will expire during such absence, or to vary to her disadvantage any of the conditions of her service.
(2)(a) The discharge or dismissal of a woman at any time during her pregnancy, if the woman but for such discharge or dismissal would have been entitled to maternity benefit or medical bonus referred to in section 8, shall not have the effect of depriving her of the maternity benefit or medical bonus:
Provided that where the dismissal is for any prescribed gross misconduct, the employer may, by order in writing communicated to the woman, deprive her of the maternity benefit or medical bonus or both.
1[(b) Any woman deprived of maternity benefit or medical bonus, or both, or discharged or dismissed during or on account of her absence from work in accordance with the provisions of this Act, may, within sixty days from the date on which the order of such deprivation or discharge or dismissal is communicated to her, appeal to such authority as may be prescribed, and the decision of that authority on such appeal, whether the woman should or should not be deprived of maternity benefit or medical bonus, or both, or discharged or dismissed shall be final.]
(c) Nothing contained in this sub-section shall affect the provisions contained in sub-section (1)."
Now, if I see this section and compare it with your case at hand, I see two very important things:
- She absented herself for 66 days in a year, which is on the higher side.
- But on the other hand, you say that she absented herself due to bad health.
Now, if we dismiss her for her absenteeism, she may take a stand that she absented herself due to illness, which is not wrong. The fact of her pregnancy also complicates things badly. Please see section 12 B above; the dismissal shall be final only when the appeal is decided by the authority if she contests her dismissal. Even if we assume that she was not pregnant, even then, to terminate any employee for continued ill health is not an easy task.
I would request you to carefully weigh your options before taking any step. Although much depends upon the nature of her absenteeism and her overall working performance otherwise. Yes, for sure, it won't be easy to terminate her.
Regards.