Is Maternity Benefit Act Applicable to Contract Employees?


June 21, 2018

This can be safely categorized as one of the most intriguing concern among women who are employed through an agency or on contract basis. However, Section 2(o) of the Maternity Benefit Act, 1961 evidently eliminates the apprehension as it defines “women” as a woman employed, whether directly or through any agency, for wages in any establishment.

Thus, the definition of woman under the Act extends benefit to all women employees including those employed through an agency or on a contract basis.

In wake of the recent amendment to the Maternity Benefit Act i.e. Maternity Benefit (Amendment) Act, 2016 several doubts had been raised by stakeholders and one among them was whether the Amendment Act extending maternity leave of 26 weeks was applicable to contractual or consultant women employees?

Subsequently, the Ministry of Labour & Employment issued a clarification  dated April 12, 2017, wherein it was stated that as there was no amendment to Section 2(o) of the Act of 1961, the Act is applicable to all women who are employed in any capacity, directly or through any agency i.e. contractual or consultant employment.

Another question which is often asked is whether Maternity Benefit Act is applicable to private sector employees?

The answer to the same is yes, the Act is applicable to private sector employees as well, as the Statute does not distinguish between a public or a private establishment as it states that the Act is applicable to:

  1. Every establishment being a factory, mine or plantation including any such establishment belonging to Government and to every establishment wherein persons are employed for the exhibition of equestrian, acrobatic and other performances;
  2. To every shop or establishment within the meaning of any law for the time being in force in relation to shops and establishments in a State, in which ten or more persons are employed, or were employed, on any day of the preceding twelve months:]

What is the condition/eligibility to claim maternity benefit?

Section 5(2) of the Act clearly states that a woman is entitled to maternity benefit if she has actually worked in an establishment of the employer for a period of not less than 80 days in the twelve months immediately preceding the date of her expected delivery.

Case Laws

Municipal Corporation of Delhi Vs. Female Workers (Muster Roll) And Another[1]in this case, the Apex Court held that the provisions of the Act i.e. Maternity Benefit Act entitle maternity leave even to women engaged on casual basis or on muster roll basis on daily wages and not only those in regular employment, the provisions of the Act in this regard, held, are wholly in consonance with the Directive Principles of State Policy contained in Arts 39 specially in Articles 42 and 43.

The Central Administrative Tribunal (CAT) in a recent case of Anuradha Arya v. The Principal & Ors. categorically stated that benefits of maternity leave with full salary cannot be denied to a female employee appointed on contractual basis and they are entitled to maternity leave as per provision of Section 5 of the maternity benefit Act, 1961. While pronouncing its order, the CAT relied on Supreme Court’s judgment in Municipal Corporation of Delhi case.

The CAT in the case further remarked that the nature of the “benefit” being claimed by the applicant in the instant case i.e. maternity benefit, cannot be routinely clubbed, or, equated to any “other benefit” being claimed by an ad hoc employee. Grant of the benefit of maternity leave to a woman employee, whether ad hoc or regular, has to be dealt with on a different footing.

Contract Employees entitled to Maternity Benefit of 6 months- The High Court of Kerala in a recent case Rakhi P.V. & Ors. v. State of Kerala & Anr. held that contract employees are also entitled to maternity leave of 180 days.

In the case, the petitioners had applied for maternity leave during the period of their employment and were denied enhanced maternity leave of 180 days as enumerated under the Maternity Benefit (Amendment)Act, 2016. The petitioner contended that going by the provisions of the Kerala Service Rules (KSR) as well as the provisions of the Maternity Benefit Act, 1961, every woman employee working in any establishment is entitled to maternity leave of 180 days.

The State’s main contention while denying 26 weeks/180 days maternity leave to petitioners was that women employees working on a contract basis under state funded projects were entitled to maternity leave of 90 days only.

The Kerala High Court in the case granted relief to the Petitioners and made the following observations in the case:

  • That the petitioners are also admittedly women employees working on a contract basis under state funded projects. The benefits of enhanced maternity leave to woman employees is undoubtedly a piece of welfare legislation which is intended to give women equal opportunities in public employment. Thus, the State’s contention that the contract employees under the projects are entitled only to 90 days of maternity leave cannot be tolerated as it would amount to discrimination against woman employees only for the reason that they are engaged in projects in contractual capacities.
  • That inalienable obligations of maternity should not and cannot be a reason to deny equal opportunities to woman employees. This precisely would be the result of limiting maternity leave to women employees, irrespective of the nature of their employment.
  • That the State’s contention that the contractual appointment of the petitioners have a duration of only one year and the grant of six months paid leave would obliterate the benefit to the project of the engagement is also not tenable because the petitioners are persons who are continuing in service on the basis of successive extension of contract.

Read more here.

Thus, from the aforesaid laws and judicial dictum it is abundantly clear that the Maternity Benefit Act is applicable to contract employees and does not discriminate between those engaged in contract employment and regular employment.

Also read Key Features of Maternity Benefit (Amendment) Act, 2016

[1] (2000) 3 SCCC 224