India: Maternity Benefits Are to Be Granted Regardless of the Period of Benefit Exceeding the Termination of Employment
In the recent judgement of Dr. Kavita Yadav v. The Secretary, Ministry of Health and Family Welfare Department & Ors.1, an appeal was filed before the Supreme Court challenging the denial of maternity benefits to the Appellant under the Maternity Benefit Act, 1961 (“Act”). The High Court of New Delhi had previously held in the matter that the Appellant was not entitled to maternity benefit on account of her period of benefit overshooting the culmination of her employment contract.
The Appellant was engaged as a senior resident at a hospital in Delhi for a term of one year, which was extendable on a yearly basis up to a maximum of three years as per the terms of the employment contract. The contract was extended twice and was set to expire on June 11, 2017. On May 24, 2017, the Appellant applied for maternity benefits starting from June 01, 2017. However, she was informed by her employer that she would be eligible only for 11 days of benefit on account of her contract coming to an end on June 11, 2017. The Appellant challenged this decision of her employer before the Central Administrative Tribunal as well as the High Court of New Delhi. However, both forums ruled in favour of the employer.
When the matter was brought before the Supreme Court, the Court opined that the continuation of maternity benefits is ingrained in the Act where the benefits are expected to surpass the cessation of employment. The Court observed that this interpretation of the law envisages the subsistence of employment for the singular purpose of availing maternity benefits under the Act. Additionally, the Court noted that the Act imposes an embargo on the employer from dismissing or discharging a woman employee who absents herself from work in accordance with the provisions of the Act, where the expression discharge would mean a discharge or conclusion of the contract period. The Court held that women employees, including contract employees, are eligible for maternity benefits once they have worked for 80 (eighty) days in the 12 months immediately preceding the expected date of delivery, even if such benefits exceed the term of the contract, and ruled in favour of the Appellant.
Key Action Points for Human Resources and In-house Counsel
Employers must note that women employees (including contract employees or employees on master roll on a daily wage basis) are entitled to maternity benefits even where the benefit overshoots the tenure of employment.