Maternity benefits or jobs

A trade-off is not inevitable. We need joint social responsibility, more gender-balanced measures

Written by Bina Agarwal | Updated: July 12, 2018 12:04:49 am

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The Maternity Benefit (Amendment) Act 2017 increases women’s leave entitlements from 12 to 26 weeks. Of these, up to eight weeks can be taken pre-delivery. (Source: Twitter)

Will the government’s efforts to extend paid maternity leave in the formal sector benefit women, or cause a backlash from employers, further undermining Indian women’s job prospects? Is a trade-off inevitable or is there another path? And what about informal sector workers?

The Maternity Benefit (Amendment) Act 2017 increases women’s leave entitlements from 12 to 26 weeks. Of these, up to eight weeks can be taken pre-delivery. Enterprises with 50 or more employees must also provide crèches and allow the mother four crèche visits, daily. Women with two or more children get reduced entitlements. The costs of these benefits are to be borne solely by employers.

A recent report by TeamLease, based on interviews with 300 employers across 10 sectors, found a negative or mixed response from all but the IT and e-commerce companies. In net terms, the Report projects some 11 to 18 lakh job losses for women in 2018-19 alone for the 10 sectors studied, and up to 1.2 crore job losses across all sectors. Although the latter figures, based on extrapolations across sectors, can be challenged, the basic idea that most employers will react negatively to extended maternity leave is credible, as found in other countries.

In the UK, when the law firm, Slater & Gordon, surveyed 500 managers in 2013, one-third admitted they would prefer to hire a young man rather than a young woman due to the high costs of maternity leave, and 40 per cent were wary of hiring women of childbearing age. A 2014 study by economists Kevin Lang and Núria Rodríguez-Planas found that in Spain, following a 1999 law which gave workers with young children the right to reduce work hours, employers were 6 per cent less likely to hire women of childbearing age, 37 per cent less likely to promote them, and 40-45 per cent more likely to let them go, relative to men. A study of 22 OECD countries by Francine Blau and Lawrence Kahn, found that although generous parental leave makes it easier for women to combine work and family care, it can lead employers to discriminate against women in jobs that lead to higher-level positions and require fulltime career commitments.

In India, where barely 6.5 per cent of women are in the formal sector, it will be disastrous if extended maternity leave further deters employers from hiring women. We need more jobs precisely in this sector, as more young educated women join the workforce. Already, we have falling female labour participation, especially due to inadequate jobs for women. Can we afford a further decline? What is the way out? I believe we need more comprehensive and gender-balanced measures.

First, childcare should not be treated solely as women’s responsibility. Some 55 per cent countries recognise the father’s role and give parental leave or paternity leave in varying degrees. But there can be a key difference between these options. Typically, unspecified parental leave ends up being taken mainly by women rather than shared equally between the spouses. A review of 24 EU countries found that men’s take-up of infant care leave was highest when part of the leave was reserved for them. Hence, given social norms, it is better to give paternity leave or non-transferable quotas of parental leave. Iceland, for instance, grants nine months of parental leave, of which three are reserved for the mother, three for the father, and three can be shared between them. Matching paternity and maternity leave would create a more level playing field for women and reduce potential employer discrimination. Of course, whether Indian men will avail of extended paternity leave remains to be seen (at present, central government employees get 15 days), but it would provide a strong incentive to do so.

A second issue is cost. Companies are less likely to discriminate against women if the government pitches in. The 2018 ILO report on Care Work and Care Jobs emphasises the need for government support up to at least two-thirds of the costs of maternity benefits, under ILO Convention 183.

However, much of this relates largely to the formal sector. What about the 93.5 per cent Indian women workers in the informal sector? The 2017 Act does not apply to them, nor is it clear how it can realistically cover women working on family farms, doing home-based work, the urban self-employed, or casual workers on contract. Domestic workers in cities, for instance, often work for several households: Which will provide maternity leave benefits? Even existing minimal benefits, such as Rs 6,000 over six months for all pregnant women under the National Food Security Act 2013, are not fully implemented.

Third, even in the formal sector, the child will need care after six months of maternity leave. The one measure that would benefit women across all sectors, formal and informal, is providing good crèches and childcare centres. India largely lacks facilities where women can leave their children not just to be “minded”, but also for early childhood development. Our Integrated Child Development Services, meant to provide nutrition and childcare up to six years of age, lack greatly in quality and coverage.

In Japan, the government’s expansion of high quality childcare centres has significantly increased women’s work participation. In India, at the very least, childcare centres should be the joint responsibility of government and private employers. The latter should also try collective solutions: For instance, SMEs located in close proximity could pool resources for creating good crèches, rather than each creating its own.

Fourth, flexible work time for both sexes can additionally help with work-life balance. Notably, in the TeamLease Report, large companies in IT and e-commerce were the main ones supporting extended maternity leave. These are precisely the sectors where flexi-time is easy to introduce and employees can work partly from home. In western counties, companies which allow such flexibility find it increases worker productivity, and is taken by both sexes.

The issue of maternity benefits thus needs a comprehensive approach and not just a one-sided Act. To ensure that extended maternity leave does not backfire on women’s jobs, we need equivalent paternity leave, government sharing of costs with employers, high quality crèches and childcare centres, and serious efforts, including media campaigns, to change social norms favouring childcare by fathers. “Children are public goods”, as one feminist economist put it. It is surely a joint social responsibility (and not just the mother’s) to ensure that children do not turn out to be public bads!

The writer is a professor of Development Economics and Environment, University of Manchester, and ex-director, IEG, Delhi

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