The Maternity Benefit Act: An Overview

The Maternity Benefit Act of 1961 must be complied with by factories, mines, and plantations. The Act applies to all businesses that have more than 10 employees working each day throughout the previous 12 months. Additionally, it applies to every shop and other establishment in the concerned Indian state. Additionally, this Act applies to specific facilities and businesses. It must be followed in order to maintain the goodwill of the workforce.

Every organization must abide by this Act, and the workers must receive a number of benefits. The outcome is that the employees get the best care and their health is maintained. The health of employees is essential since it promotes the growth of the company.

The following are the major conditions required to fulfill in order to claim maternity benefits −

• The employee (women) must have worked for the establishment for at least 80 odd days in the previous 12 months in order to be eligible to receive benefits under this Act.

• The Act also protects women who miscarry, in addition to public hospitals, nursing homes, schools, and other businesses.

• A woman is entitled to a maximum of six weeks of paid leave if her pregnancy ends in miscarriage or she has an abortion. If she delivers the baby earlier than expected, the earnings will be paid 48 hours after the birth certificate is shown.

• Women were granted 12 weeks of maternity leave under the terms of the Maternity Benefit Act of 1961. The Maternity Benefit (Amendment) Act of 2017 has raised the leave term from 12 to 26 weeks, nevertheless.

• The 26−week maternity leave period can be divided into up to 8 weeks of leave before the expected delivery date and the remaining leave following childbirth.

• Up to two children may be granted the 26−week maximum maternity leave duration. The 12−week leave period applies to mothers who have more than two children. According to the act, a woman is not obligated to work for six weeks after a miscarriage, unless the miscarriage was caused by a medical termination of the pregnancy. Surrogate moms and mothers who have adopted a child under three months old are also eligible for 12 weeks of leave.

Section 3 Definitions

Section 4 Employment of, or work by, women is prohibited during certain periods.

Section 5 Right to payment of maternity benefit.

Section 7 Payment of maternity benefit in case of death of a woman.

Section 8 Payment of medical bonus.

Section 13 No deduction of wages in certain cases.

Section 18 Forfeiture of maternity benefits.

Section 21 Penalty for contravention of Act by the employer.

All about Overtime Payment Rules in India

Factory: Factories Act, 1948

• Weekly Limit - Maximum 48 hours a day.

• Daily limit - Maximum 9 hours a day.

• Interval - No work for more than 5 hours without an interval. 

• Spread over - Working hours including interval periods not more than 10.5 hours.

• Overtime limit - Daily work time inclusive of overtime shall not exceed 10 hours which is 60 hours on a weekly basis. Overtime hours cannot exceed 50 hours in a quarter (3-month period).

As per Section 59 of the Factories Act, 1948, a person is entitled to be paid overtime wages twice his ordinary rate of wages in case he/ she is required to work for more than 9 hours a day or more than 48 hours in a week. The wages mentioned here are equivalent to the basic wages along with allowances but do not include any bonus or other overtime wages. In case a worker is paid on a ‘piece rate’ basis, the time rate will be calculated on the basis of the previous month and the amount of overtime wages will be calculated accordingly. 

Shop/ Establishment: Shops and Establishments Act of States/ UTs

• Daily working hours may range from 8-10 hours

• Weekly working hours cannot exceed 48 hours

• Overtime may range from 10-11 hours on a daily basis (1 to 3 hours)

• No continuous (break-free) work for more than 5 hours in one go

• Weekly limit of 50-60 hours

• Quarterly limit of 50-150 hours

• Spread over a limit of 10-14 hours

Depending upon the rate fixed by states or union territories, employees are paid for overtime hours apart from fixed working hours in the shops or establishments. In some states, the overtime amount is twice the usual working hours. Here again, the employee overtime rate is calculated for basic + allowances (not including any bonus).

 Mines Act, 1952

• Daily Working Hours - 9 hours a day above ground/ 8 hours a day under the ground

• Weekly hours - Maximum 48 hours a week

• Overtime - If a person works for more than a fixed time (above or below the ground), he/ she is entitled to overtime wages twice the ordinary rate[6]

• The payment will be equivalent in case of employee works on a piece rate

• There is a work hour limit of a maximum of 10 hours a day inclusive of overtime

As per the overtime payment rules in India, it is calculated on basic salary. It may also include dearness or any other allowance. But it may be noted that labor law on overtime in India excludes any bonus or other such incentive while deciding or calculating overtime payment rules. In any case, the overtime payment rules do not regard the gross salary. But if there is no statutory obligation and the employer wishes to reward the hard-working employees voluntarily, overtime payment rules in India do not restrict the same. In such a case, whether overtime is paid on basic or gross in India is the employer’s choice.

Shop and Establishment Act and employment Law

The Shop and Establishment Act governs the state's active shops and commercial establishments. The Shop and Establishment Act (the "Act") is unique to each state. The Act's general requirements, however, apply to all 50 states equally. The Shop and Establishment Act is put into effect by the labor departments of the individual states.

According to the Act, a shop is commonly defined as a place where items are sold, either retail or wholesale, or where consumers get services. As part of the trade or business, it also comprises offices, godowns, storerooms, and warehouses.

Generally speaking, a commercial establishment is any business, financial institution, trading company, insurance agency, or office-based service. Hotels, boarding houses, restaurants, cafes, theatres, and other public entertainment and amusement facilities are included. However, the Factories Act of 1948 and the Industries (Development and Regulation) Act of 1951 regulate factories and industries, which are not covered by the Act.

The shops and businesses covered by the Act are obligated to submit an application for registration under the applicable state Act. A Shop and Establishment Registration Certificate or Shop Licence ("Certificate") is required by the Act for all businesses and establishments, including those run entirely from home.

The Act, among other things, regulates the following matters-

Hours of work, annual leave, weekly holidays.

Payment of wages and compensation.

Prohibition of employment of children.

Prohibition of employing women and young persons on the night shift.

Enforcement and Inspection.

The interval for rest.

Opening and closing hours.

Record keeping by the employers.

Dismissal provisions.

Employment Policy Design in India

Employment / HR policies provide written guidance for employees and managers on how to handle a range of employment issues. They play an important role in practically and effectively implementing an organization’s HR strategy. Human resources policies provide the necessary structure many businesses need to sustain the company’s productivity and overall profitability. Our HR policy design services are responsible to review existing policies, identifying gap areas, design policies, programs, and initiatives aligned to HR strategy, the Company’s Values, Vision, Business requirements, and law of land.

We design policies for the complete life cycle of employees in an organization. Covering areas from Talent Acquisition, Talent Management, Total Rewards and Wellness (. Employee Benefits & Compensation Structuring, Employee Stock Options & Share Plans), Employee Relations, Talent Development, Health and Safety, Administration, Diversity and Inclusion, Code of conduct, Employee Participation, Employee Separation policies (including VRS), Communication policies including social media, etc.

This includes the following Stages :

HR Policy Current Stage Audit

Risk and Gap Identification

Identify Policies required based on business requirements and the law of the land.

Advisory on identified policies

Provide Required Support w.r.t Industry Insights (without client details) and Best Practices

Drafting, Implementation, Rollout, and Communication plan support.