Maternity Benefits beyond Contractual Employment

Background

1. The Appellant held a temporary position as a Senior Resident Pathologist under Residency Scheme at Janakpuri Super Speciality Hospital, an autonomous institute under the Government of NCT of Delhi.
2. The appointment of the Appellant was on contractual basis initially only for a period of 1 year, extendable on a yearly basis up to a maximum of 3 years. She initially joined on July 12, 2014 which was further extended twice. Her last extension was for the period of 1 year from July 12, 2016 to July 11, 2017.
3. On May 18, 2017, the Appellant applied for earned leave from May 15, 2017 to May 31, 2017 on medical grounds.
4. In accordance with Sections 5 (Right to Payment of Maternity Benefit) and 8 (Payment of Medical Bonus) of the Maternity Benefit Act (hereinafter referred to as “The Act”), Appellant submitted an application for maternity benefits on May 25 and subsquently on July 1, 2017. As per the residency plan, her term ended on July 11, 2017, and the employer notified the Appellant that no additional extensions were permitted by the relevant rules thus, she was only eligible for 11 days of maternity benefits.
5. The Appellant challenged the same before the Central Administrative Tribunal and then before Hon’ble Delhi High Court wherein her contentions were rejected. The Delhi High Court observed that the purpose of Maternity Benefit Act is not to extend the period of contract, to enable her to avail maternity benefits under the Act.

Question before the Supreme Court

Will the female employee employed on contractual basis can claim the maternity benefits, as per provisions under the Maternity Benefit Act, as her employee contract was expiring in 10 days?

Supreme Court’s Pronouncement

1. The Supreme Court referred to Section 12(2)(a)[3] of the Act and held that “contemplates entitlement to the benefits under the 1961 Act even for an employee who is dismissed or discharged at any time during her pregnancy if the woman, but for such discharge or dismissal, would have been entitled to maternity benefits or medical bonus. Thus, continuation of maternity benefits is inbuilt in the statute itself, where the benefits would survive and continue despite the cessation of employment”.
2. The Supreme Court held that once an employee is entitled to maternity benefits under Section 5 (2) of the Act (i.e., completed 80 days of employment) “such benefits can travel beyond the term of employment also. It is not co-terminus with the employment tenure”.
   
   The Supreme Court referred to following earlier judgments: –
   • Municipal Corporation of Delhi vs Female Workers, 2000 ((2000) 3 SCC 224 )
     It was held that women employees “…tenure also stood notionally extended so far as application of maternity benefits… under the Act.
   • Union Govt., employees under CCS (Leave Rules), 1971
     Based on the ratio of the aforesaid judgment and in the light of Section 27 of the Act, held that Section 27 of the Act, “gives overriding effect to the statute on any award, agreement or contract of service”.
3. In reference to last proviso Section 5(3) of the Act, the Supreme Court further held that the maternity benefits are available for the entire period, even if the women die after delivery of the child.
4. The Supreme Court further observed that “there is an embargo on the employer from dismissing or discharging a woman who absents herself from work in accordance with the provisions of the Act during her absence. This embargo has been imposed under Section 12(2)(a) of the Act. The expression “discharge” is of wide import, and it would include “discharge on conclusion of the contractual period”. Further, by virtue of operation of Section 27, the Act overrides any agreement or contract of service found inconsistent with the 1961 Act.”

Conclusion

In essence, the Supreme Court ruled that after an employee has worked for 80 days or more and meets the requirements for receiving maternity benefits, “she would be eligible for full maternity benefits even if such benefits exceed the duration of her contract.” Any effort by the employer to terminate the contract term while she is eligible to receive maternity benefits is considered a “discharge” and is subject to the embargo outlined in Section 12(2)(a) of the 1961 Act.

The employer is required by the Maternity Benefit Act to continue providing maternity benefits even if the length of the work contract expires while the period of benefits is in effect.

Disclaimer

The information provided in this article is intended for general informational purposes only and should not be construed as legal advice. The content of this article is not intended to create and receipt of it does not constitute any relationship. Readers should not act upon this information without seeking professional legal counsel.