The impact of the Maternity Leave Amendment in India
India can ask an extraordinary amount of its businesses: Adopt new technology, reorganise supply chains, meet new standards, train workers and deliver against punishing deadlines.
Then a woman needs time to recover from childbirth, and suddenly the conversation becomes whether employing her was a good idea.
That is the conversation we should refuse to normalise.
The impact of the maternity leave amendment deserves a serious examination. If a measure designed to protect working mothers creates incentives to exclude women, defending its intentions is insufficient. We must examine its financing, its implementation and the decisions employers make in response.
But reducing a woman’s protection cannot become our first demonstration of business ingenuity.
India’s reputation for jugaad rests on finding a way through a difficult problem. Surely that resourcefulness can extend to keeping a skilled woman employed while she has a child.
First, understand what the research actually says
An August 2026 IZA discussion paper by Souvik Banerjee, Preeti Jaiswal and Sankar Mukhopadhyay estimates 8.4% lower female employment and 2.6% higher male employment following the amendment in its principal comparison.
Using manufacturing data for 2012–13 to 2019–20, it compares firms with 20–29 employees against those with fewer than ten. These are estimated relative effects, not a national employment tally or a count of women dismissed. The alternative 10–19 employee comparison finds no statistically significant female employment effect. [1]
Its coverage assumptions merit scrutiny. The historical law separately covered factories; the ten-person threshold explicitly applied to shops and establishments. How that distinction affects the comparison group needs clarification. ESI coverage also complicates a blanket employer-cost explanation. [1][2]
The findings are a reason to investigate. They are insufficient grounds to declare maternity protection a failed idea.
What India expanded, and what the argument keeps overlooking
The 2017 amendment extended paid maternity leave from 12 to 26 weeks for eligible women with fewer than two surviving children. Women with two or more surviving children retained the 12-week provision. It was a significant expansion of protection around childbirth, rather than an unconditional six-month entitlement for every working woman in every circumstance. [3][4]
This article examines that historical reform. The Government’s subsequent guidance on the Code on Social Security also describes a maximum 26-week maternity benefit for eligible women. The financing debate remains relevant within that newer framework. [5]
There are two questions here. How much protection should a woman have? And how should the economic cost of providing it be distributed?
Collapsing them into one question creates a convenient answer: if the employer struggles, the woman should receive less.
That answer leaves almost every difficult institutional question untouched. It does not build a replacement workforce. Neither does it improve the predictability of payments. Nor does it make fathers available for care. It merely transfers more of the adjustment to the mother.
She is already recovering, caring for an infant and trying to protect her earnings. Why should her rights become the easiest variable to reduce?
A funding problem can become a hiring prejudice
Consider an illustrative small manufacturing unit with a tight delivery schedule. An experienced employee goes on maternity leave. The owner may need to finance her benefit, recruit a replacement, train that person and absorb the disruption to production.
Those are real operating questions. A speech about empowerment will not answer them.
The International Labour Organisation explicitly recognises that direct employer liability can be particularly difficult for small enterprises, including when they must support both a worker on leave and her replacement. It also warns that this financing model can encourage discrimination against women of childbearing age. Collective financing spreads risk and makes expenditure more predictable. [6]
The danger begins when a particular staffing challenge becomes an assumption about every female applicant.
An interviewer who evaluates a woman through the possibility of a future pregnancy is making her compete against an imagined absence. Her actual skills, attendance and performance have not even entered the calculation.
A business can have a legitimate financing concern and still make an indefensible hiring decision. Recognising the first does not excuse the second.
That is especially consequential in occupations where women are already fighting for entry. Our earlier coverage of the gender gap in blue-collar jobs considers that broader problem. Maternity financing should not add another reason to keep the door half-closed.
Put the ingenuity into sharing the cost
The strongest reform question is straightforward: how can we reduce the incentive to treat a prospective mother as an unusually expensive recruit while preserving her entitlement?
India already has experience of maternity benefits through Employees’ State Insurance. Eligible insured women receive maternity cash benefits under that contributory system. It would therefore be inaccurate to describe every maternity payment in India as a bill borne directly and exclusively by an individual employer. [2][7]
That experience provides a starting point for examining wider pooled financing. It does not mean that extending coverage would be administratively simple or cost-free.
Government, employers and worker representatives should examine a funded mechanism for eligible workers outside the existing insurance route. Its contribution base should spread maternity costs broadly, rather than make a firm’s bill rise simply because it employs more women.
The design must answer awkward practical questions. Who contributes? Which workers qualify? How are wages verified? What happens when contributions are missing? How quickly is money paid? Who handles a disputed claim?
A reimbursement promise is of limited comfort to a small employer that must wait months. A payment delay is even more serious for a woman whose household depends on her income. Any mechanism needs clear payment deadlines, a way to resolve errors and public reporting on delays.
These are proposals for examination and testing. Their credibility depends on the sums and the administration behind them. Calling for a fund is easy; building one that pays reliably is the work.
A factory needs a replacement plan
Financing leave and covering a shift are different operational tasks. Even a fully funded benefit does not produce a trained replacement at the factory gate.
Manufacturing associations and industrial clusters could pilot shared pools of trained relief workers, with transparent contracts, safe conditions and proper pay. Firms could plan cross-training for critical roles before an absence becomes urgent. Larger buyers could help suppliers finance that preparation through purchasing arrangements that recognise realistic staffing costs.
This should be a structured programme, with employers remaining responsible for lawful employment conditions. Casualising everyone’s job would defeat the purpose.
Inside a firm, continuity planning should cover foreseeable absences across the workforce. Where feasible, more than one person should know how to perform a critical task. Managers should budget for temporary cover and agree handovers without expecting a woman to remain available throughout her leave.
Nor should colleagues be expected to absorb months of extra work for free. An arrangement that protects one worker by exhausting three others will create resentment that management then wrongly attributes to maternity leave.
For a machine operator, a work-from-home promise may be meaningless. Useful support could instead involve predictable shifts on return, safe transport, accessible childcare and realistic production targets. These measures must fit the actual job.
Our test of jugaad should be whether it solves the operational problem while keeping the woman’s employment secure. Reclassifying her role or quietly refusing to recruit women is evasion dressed up as efficiency.
Fathers must become part of workforce planning
If an organisation plans for mothers to be absent and fathers to remain continuously available, parenthood becomes a female employment characteristic.
Paid, usable leave for fathers deserves a place in this debate, supported by financing that smaller employers can sustain. Dedicated leave that fathers can take themselves would make their role in early care more concrete.
However, a new entitlement alone would not settle the matter. Men must be able to use it without losing assignments or being treated as uncommitted. Employers should examine take-up and career outcomes, rather than celebrate the policy document.
Paternity leave also cannot erase the physical realities of pregnancy, birth and recovery. It should add support for the family while widening the distribution of care.
The objective is to make caring for a child an ordinary part of employment planning for parents.
Follow the woman beyond the payroll
A company may comply with maternity payments and still fail a woman on her return. The useful questions concern what happens next: her role, earnings, shift, progression and access to training.
Employers should review recruitment decisions alongside return-to-work outcomes. Are women reaching the interview stage but disappearing from offers? Are mothers returning to equivalent work? Do adverse decisions have documented, job-related reasons that would withstand an independent review?
That review should protect privacy. Recording women’s pregnancy intentions is no substitute for examining management decisions.
We must also keep workers outside dependable employment protection in view. Change in Content’s coverage of women workers in the informal sector addresses lives that a formal payroll debate can overlook.
India’s Pradhan Mantri Matru Vandana Yojana provides eligible women with maternity support intended partly to compensate wage loss and support health and nutrition. That assistance has a different purpose and structure from employer-linked paid leave and job continuity. Neither should be casually presented as a substitute for the other. [8]
A credible reform agenda must ask what reaches the woman who has no secure job to return to, as well as the woman negotiating her return to a factory.
Women should not have to become cheaper to become employable
Calling every criticism of policy anti-woman would be intellectually lazy. A funding arrangement can create perverse incentives. Rules need evaluation, and evidence of harm deserves a response.
It is equally lazy to treat those incentives as an instruction to give women less.
An employer asking for predictable funding, practical replacement arrangements and workable administration is raising a problem worth solving. An employer treating women’s possible pregnancies as a recruitment filter is making women carry that problem personally.
India has the institutions and practical ingenuity to pursue a better settlement. Government must examine financing. Industry must help build staffing capacity. Managers must account for their hiring decisions. Fathers must be enabled and expected to care.
The woman should not have to bargain away recovery time to prove that employing her makes commercial sense.
When a maternity entitlement meets an employment penalty, the challenge is to redesign the arrangements around it. Reducing women’s rights is an admission that we stopped looking for a better solution.
Sources and editorial verification
- Banerjee, Jaiswal and Mukhopadhyay, IZA Discussion Paper 18888, August 2026. Preliminary research, not a definitive national causal verdict. Paper-derived findings and comparison design are summarised in the article; avoid extracting the percentages into context-free promotional graphics.
- Ministry of Labour and Employment: Maternity benefit to women working in unorganised sector, 5 February 2024. Historical scope and interaction with ESI.
- PIB: Maternity Benefit amendment passed in Parliament, 9 March 2017. Historical expansion.
- Maternity Benefit Act, section 5, official Income Tax Department legal text. Historical eligibility and surviving-children distinction.
- PIB: New Labour Codes Empower Women with Greater Safety, 27 November 2025. Current-framework context; this article is not an individual eligibility guide.
- ILO: Frequently asked questions on Convention No. 102, 6 August 2024. Employer-liability concerns and collective financing. Cited as financing guidance, not as a statement about India’s treaty obligations.
- ESIC: Frequently asked questions. Insured maternity benefit and qualifying conditions.
- Ministry of Women and Child Development: PMMVY. Scheme purpose and eligibility; no claim of universal access.
