Maternity Policies in Maharashtra: Can Companies Set Their Own Rules for Leave and Pay?

If a company has 90% female employees, is there any relaxation for maternity benefits? Can a company create its own maternity policy stating:

1. Maternity leave can only be taken after completion of 2 years.
2. If you are on maternity leave, you will be paid for 3 months.
3. During maternity leave, you will receive only a basic salary.

Can a company include these points in their maternity policy for Maharashtra?

If the points are against the provisions of the Maternity Benefit Act, then how can we consider these points in your Maternity Benefit policy? First, go through the MB Act and then see whether your points are against the law. If your answer is yes, then this cannot be taken into consideration while framing the policy.

Regards, R N KHOLA

The Maternity Act applies if you are employing more than 10 employees; it doesn't matter if you are employing 90% female employees.

The Act applies to mines, factories, circuses, industries, plantations, and shops and establishments, except employees covered under the Employees' State Insurance Act, 1948. It can be extended to other establishments by the state governments. There is no wage limit for coverage under the Act.

You can always provide extra benefits to the employees that are not stated in the act but not less.

Please go through the Maternity Benefit Act. You will definitely conclude with a 'NO' for all your questions.

Regards,
Sudha

Yes, nothing stops you from making your own Maternity Benefit (MB) policy provided—and this is important—the same offers better benefits than the MB Act to your women employees. Remember, the Act always stipulates the minimum conditions that must be complied with without any choice.

Therefore, if you create a policy that provides lesser benefits—which appears to be your clear intention in your proposal—it would be a violation of the Act, leading to punitive action by the authorities.

The choice is yours.

Regards,
Vinayak Nagarkar
HR and Employee Relations Consultant

Dear Colleague,

It is not advisable to implement a separate policy for maternity benefits for employees, as uniform implementation is not possible. For employees covered under ESI, the provisions will mandatorily apply since both the employer and employees contribute to it. ESI will extend benefits and medical care for the insured person. If employees are not covered under ESI, then the provisions of the Maternity Benefit Act 1961 apply. Here, the employer must directly extend benefits to the applicable employees as and when they arise. Therefore, implementing any independent policy may not be very relevant for employees. If you wish to extend anything more than ESI and Maternity Benefit uniformly for all such employees, that is commendable. It is an additional benefit, but in the present economic scenario, think twice before deciding.

Consistency with Statutory Provisions

No policy shall be inconsistent with the terms of statutes. You can provide additional benefits beyond the Act, but they should not be less or inconsistent. This provision is applicable to all statutes, not only to the Maternity Benefit Act.

I think all our HR policymakers should keep in mind the relevant statutory provisions before making any policy.

Statutory Acts and HR Policies

Statutory Acts like the MB Act, ESI Act, or PF Act, in a broader sense, aim for the benefit and security of employees. With the same purpose, HR policies are drawn. HR policies vary from company to company in terms of administration, benefits, procedures, etc. However, irrespective of the company, HR policies ensure the welfare of employees. Hence, any benefit over and above what a statutory act prescribes is welcome.

Therefore, benefits as per HR policy should be more than what is prescribed under a statutory act.

Yes, you can have a separate Maternity Benefit Policy, provided it offers more benefits than the Maternity Benefit Act. You cannot offer anything less than what is stated in the MB Act. The MB Act stipulates the minimum benefits that an employer should provide to a female employee. Offering less than that amount is a serious violation and is punishable by law. The Department of Labour may take legal action against your company.