11 September, 2019
The Maternity Benefit Act, 1961 (the Act) was introduced to regulate the maternity and related benefits that are extended to women in certain establishments for a period before and after childbirth.
In 2017, by way of the Maternity Benefit (Amendment) Act, 2017 (Amendment Act), various progressive changes were brought about to the law, such as an increase in maternity leave from 12 to 26 weeks, provision for maternity leave for adopting mothers and commissioning mothers, and the introduction of a work-from-home concept as part of an employee’s conditions of service.
Section 11A of the Act, which was introduced under the Amendment Act, made it compulsory for every establishment employing 50 or more employees to provide a crèche facility for its employees. The Amendment Act uses the term “employees” and not “women” thus leading to varied interpretations – for example, does “employees” include employees of all genders and does the Act apply to both permanent as well as contract employees?
Pursuant to Section 28 of the Act, the Karnataka Maternity Benefit (Amendment) Rules, 2019 (Rules) were published in the Gazette and brought into force on August 8, 2019. While the Rules maintain the spirit of the Amendment Act and also the National Minimum Guidelines for Setting up and Running of Crèche (Guidelines), employers in Karnataka are grappling with actual implementation and compliance with the same.
- Applicability: The Rules clarify that “employees” would include permanent, contract, daily wages and temporary employees. However, the Rules have further created confusion by interchangeably using the terms “parent” and “mother” throughout the Rules. While it may have been the intent of the legislature to increase the ambit of the Act to allow male employees to receive childcare benefits, the same may be considered ultra vires the Act, given the objective of the Act was to only cover women. That said, unless successfully challenged, all employees would have grounds to claim rights over this benefit for their children.
- Age limit: The Rules make it mandatory for employers to have a crèche facility for employees who have children below the age of six years. The age limit under the Rules is consistent with the Factories Act, 1948, the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, as well as the Guidelines.
- Head Count: The employer is obligated to provide one crèche for every 30 children. Employers having a larger workforce will be compelled to have multiple crèches, which makes it administratively difficult to manage. The Rules do not explicitly provide for any exemptions for employers that have a larger workforce, by allowing them to have one large facility to accommodate children beyond the prescribed limit, even if they are compliant with other conditions under the Rules.
- Building norms, safety, health and other welfare measures: The Rules prescribe that the crèche should be built within the establishment or within 500 meters from the entrance of the establishment with materials such as lime plaster, cement, etc. The crèche is to be built on the basis of 5 sq. ft. of floor area for each child in the crèche (i.e., at a minimum 150 sq. ft. in aggregate). Each crèche facility is also required to have a kitchen, space for washing/ drying and an adjacent washroom in the ratio of 1 to every 20 children. The crèche should not be situated where there are establishments emitting obnoxious gases, dust, odour or loud noise. The children should have a playground within the facility and there shall not be any open drains and pits. While the legislature has taken efforts to caution the employer on safety, health and welfare parameters while constructing the facility, the practical constraints that employers will face when implementing the Rules have not been taken into account.
- Shifts: The crèche is required to be made available to employees working in different shifts.
- Amenities and Facilities: The Rules lay down the amenities that need to be made available within the crèche such as milk, refreshments, uniforms, soap, etc. It also mentions the ratio of crèche staff to be appointed per child and the minimum qualifications required of such staff. The employer is also obligated to conduct medical examinations and checkups of the children, the records of which have to be maintained at the crèche.
Practical Difficulties
- Ambiguous criteria for determining number of crèches
These Rules do not draw a distinction between employees who want to use the crèche facility and those who do not. For example, an establishment that has more than 50 employees, of which 35 employees have children below the age of six years, would have to set up two crèches irrespective of the fact that only five employees may actually want to use the crèche facility. A harmonious reading of the provisions of the Rules would suggest that the number of crèches being maintained should be dependent on the number of children who are using the facility.
- Sharing of costs
The Rules are silent on the cost of providing crèche facilities, especially in situations where the employer is providing facilities that are above the minimum requirements prescribed under the Rules. Employers should have been able to pass on some of these costs to employees. The issue of cost also arises in cases of contract workers and whether the same can be passed on to the contractor, which contractually would still be possible.
- Outsourcing of crèche facilitates and shared crèche facilities
The Rules do not address the outsourcing/sub-contracting of crèche facilities to third parties or the possibility of having shared crèche facilities amongst multiple employers, especially in industrial areas and large commercial complexes, which have multiple offices and may have physical space constraints. This issue is further complicated by the fact that multiple crèches would still have to be maintained depending on the number of children using the facility.
- Infrastructure cost and constraints
The Rules prescribe a minimum floor area per child and additional requirements such as kitchen, washrooms, play area, etc. The cost and availability of real estate in congested commercial areas would make the implementation of these Rules difficult, expensive and, in some cases, impossible. The implementation of these Rules may require a multi-pronged approach, with the government making suitable changes to the National Building Code of India and other local municipal laws to make it mandatory for builders of large offices and commercial spaces to set aside space for crèches.
- Cost of medical examination and privacy of personal data
The Rules require children at the crèche to undergo periodic medical examinations, with the medical records to be maintained at the crèche. It appears that the costs associated with such medical examination would have to be additionally borne by the employer. Further, since such medical information would be sensitive personal data, the employer would have an added obligation to maintain the same in accordance with reasonable security standards and practices, and comply with requirements under the Information Technology Act, 2000.
- Registration of crèche
While the Rules prescribe some minimum qualifications for crèche staff and also the conditions of the building and facilities, the Rules do not prescribe any registration requirement for the crèche to ensure compliance with minimum safety standards. It appears that this will be within the ambit of the inspector under the Act, but corresponding changes to the Rules will have to be made to ensure this is also covered.
- Allowance instead of facility
Many women employees would rather have an allowance for childcare until the child is six years old, which would give flexibility to such women employees in arranging childcare facilities of their own choice, instead of being forced to utilise childcare facilities provided by the employer.
The intent behind the Amendment Act and the Rules is noteworthy. However, there are practical difficulties in implementing the same, with unintended repercussions arising from enforcement.
For further information, please contact:
Rashmi Pradeep, Partner, Cyril Amarchand Mangaldas
rashmi.pradeep@cyrilshroff.com
