Can I Legally Lay Off an Employee Returning from Maternity Leave Due to Poor Financial Condition of the Company in Pune, India?

I have been asked if I can lay off an employee who is returning from maternity leave due to a lack of projects and poor financial condition of the company. Is this legally permissible?

The legality of laying off an employee returning from maternity leave largely depends on the labor laws of the country. In India, the Maternity Benefit Act, 1961, protects the employment of women during the time of her maternity and provides for maternity benefit and certain other benefits.

According to the Act, it is unlawful to discharge or dismiss a woman during her absence or pregnancy on account of her maternity leave. If the woman is dismissed on account of any gross misconduct, the employer must provide a written reason for the same.

However, if the company is facing genuine financial difficulties and needs to lay off employees, it should be done in a non-discriminatory manner. That means you cannot single out the employee returning from maternity leave. If layoffs are necessary, they should be done based on factors such as performance, seniority, or other non-discriminatory reasons.

It's highly recommended to consult with a legal expert or labor law consultant before making any decisions. This will ensure you're in compliance with all relevant laws and regulations, and help you avoid potential legal complications.

Gitanjali-Mudaliar,
1. The lay off is okay.
2. The laying off an employee who is returning from her maternity is not only bad but illegal.
3. The precondition for lay off is, no projects in hand and poor financial company condition.
4. This condition is always for whole of the establishment and for entire employees but not for single employee.
5. This post is all about a termination of an employee on her post joining to maternity leave.
6. Your establishment needs to apply for the lay off in prescribed form to the government in 90 days advance, lay off can be done post -sanctions
7. Terminate the employee by Paying the notice pay rather than going for stringent process.
8. You need to mind that the case may face on breach of MB Act.

Gitanjali-Mudaliar,
Should financial constraints be listed within the labour code it therefore will be considered. However, good corporate citizenship would also exhaust less harsher options eg temporary cessation of work.

Estaban, BWI

You cannot pick and chose and lay off. If you mean retrenchment (permanently terminating the employee) by lay off (which is very common among new generation HRs) then also you cannot pick and chose the employee to be sent out. You can only retrench that employee who joined the last. In other words, it should be the last employee joined the company or a department who should be retrenched first in order to reduce the manpower. Again, in order to declare lay off (in its legal term) or terminate an employee, you have to follow a procedure without which the lay off or termination will become illegal.

Many of the professional use the word of Layoff for retrenchment

Yes there are provisions to retrench/terminate employee but need to follow the guidelines