Her contract ended in 11 days. The Supreme Court gave her 26 weeks of maternity benefits.

When a contract ends but maternity benefits don't: The Supreme Court's game-changer for temporary women workers

Dr. Kavita Yadav was a pathologist. She worked as a Senior Resident at Janakpuri Super Speciality Hospital in Delhi, on a temporary contract that was renewable yearly for up to three years. Her last extension was set to expire on 11th June 2017. On 1st June 2017, she applied for 26 weeks of maternity leave. Her employer told her she could only get 11 days of benefits — the remaining days of her contract. The stakes were brutally simple: either she got the full 26 weeks of maternity benefits the law promised, or she got nothing beyond the 11 days her contract had left. The Supreme Court of India, in a judgment delivered on 17th August 2023, answered that question with a resounding "full benefits."

The 11-day trap

Dr. Kavita Yadav was appointed under a residency scheme that capped her tenure at three years. Her contract was renewed annually. By June 2017, she was in her final year. When she applied for maternity leave starting 1st June 2017, the hospital administration took a literal view: her contract ended on 11th June 2017. Therefore, they reasoned, she could only get maternity benefits for those 11 days. The remaining 15 weeks and 4 days of the statutory 26-week period? Gone. The contract had expired, and so, they argued, had her entitlement.

Dr. Yadav approached the Central Administrative Tribunal, Principal Bench, New Delhi. The CAT dismissed her application. It upheld the employer's decision, agreeing that maternity benefits could not extend beyond the contract period. She then moved the High Court of Delhi. On 19th August 2019, the High Court dismissed her petition as well. The High Court held that the phrase "actual absence" in Section 5(1) of the Maternity Benefit Act, 1961 presupposed continuing employment. If the employment ended, the "actual absence" ended with it. The contract period, the High Court said, was the ceiling for maternity benefits.

Dr. Yadav had lost twice. But she had one more shot: the Supreme Court of India.

What the Maternity Benefit Act actually says

The Supreme Court bench — Justice Aniruddha Bose (who authored the judgment), Justice Sanjay Kumar, and Justice S.V.N. Bhatti — looked at the statutory scheme. Section 5 of the Maternity Benefit Act, 1961 is the core provision. Section 5(1) says every woman "shall be entitled to, and her employer shall be liable for, the payment of maternity benefit at the rate of the average daily wage for the period of her actual absence." Section 5(2) sets the qualifying condition: she must have worked for at least 80 days in the 12 months immediately preceding the date of her expected delivery. Section 5(3) caps the benefit at 26 weeks (for two or more surviving children, 12 weeks).

The key question was: does the entitlement under Section 5(2) survive the expiry of a fixed-term contract?

The employer's argument, which the CAT and High Court had accepted, was that "actual absence" under Section 5(1) could only exist if the woman was still in employment. Once the contract ended, there was no employment, and therefore no "absence" to compensate. The benefit, they said, was co-terminus with the contract.

The Supreme Court rejected this reasoning entirely.

The two precedents that mattered

The Court relied on two key decisions. First, Municipal Corporation of Delhi v. Female Workers (Muster Roll) & Anr., (2000) 3 SCC 224. In that case, the Supreme Court had held that maternity benefit provisions under the 1961 Act apply to daily-wage and muster roll workers, not just regular employees. The Court had relied on Articles 14, 15, 39, 42, and 43 of the Constitution, as well as international human rights obligations, to hold that the protective purpose of the Act overrides the nature of employment. If a daily-wage worker could claim maternity benefits, why not a contractual Senior Resident?

Second, Deepika Singh v. Central Administrative Tribunal And Others, (2022) 7 SCR 557. In that case, the Supreme Court had analysed Section 5 of the 1961 Act to guide the interpretation of cognate legislation (the CCS Leave Rules). The Court had held that the 1961 Act was enacted to secure women's right to pregnancy and maternity leave and to afford flexibility to live an autonomous life both as mother and worker. The purposive interpretation of maternity benefit legislation, the Court said, must be driven by its constitutional underpinnings.

The statutory fiction the Court created

The Supreme Court's reasoning turned on two statutory provisions that the lower courts had overlooked.

First, Section 12(2)(a) of the 1961 Act. This provision says that no employer shall "discharge or dismiss" a woman during her pregnancy. The Court held that any attempt by the employer to enforce the contract duration term within the maternity benefit period constitutes "discharge" within the meaning of Section 12(2)(a). The employer cannot use the contract's expiry as a sword to cut off benefits that the statute has already granted.

Second, Section 27 of the 1961 Act. This provision gives the Act an overriding effect over any other law, contract, or agreement. The Court held that the contract between Dr. Yadav and the hospital could not override the statutory entitlement under Section 5(2). Once she had fulfilled the 80-day qualifying period, her entitlement to 26 weeks of maternity benefits was absolute. The contract could not reduce it.

The Court then created a statutory fiction: the law treats a contractual woman employee as being in employment for the sole purpose of availing maternity benefits under the 1961 Act, even after the contractual expiry. This fiction is necessary to give effect to the protective purpose of the Act. Without it, employers could simply time contracts to expire during pregnancy and avoid all liability.

THE PLAY: Once a woman fulfills the 80-day qualifying period under Section 5(2) of the Maternity Benefit Act, 1961, her entitlement to full 26-week maternity benefits is absolute. The employer cannot use the expiry of a fixed-term contract to cut off those benefits. Any attempt to do so constitutes "discharge" under Section 12(2)(a) and is void under Section 27.

Why the High Court got it wrong

The High Court had held that "actual absence" under Section 5(1) presupposes continuing employment. The Supreme Court disagreed. The Court noted that the expression used in the legislation is maternity "benefits," not "leave." This distinction is crucial. A "leave" presupposes an ongoing employment relationship — you take leave from a job you still hold. But a "benefit" is a monetary entitlement that is not contingent on an ongoing employment relationship. The statute creates a right to payment, not a right to absence from work. The payment is calculated by reference to the period of absence, but the entitlement to payment is independent of whether the employment continues.

The Court also noted that Section 5(3) caps the benefit at 26 weeks. If the contract expires during that 26-week period, the benefit does not expire with it. The cap is a maximum, not a variable that shrinks with the contract.

The operative order

The Supreme Court set aside the High Court judgment dated 19th August 2019 and invalidated the CAT decision. The employer's orders rejecting Dr. Yadav's maternity benefit claim were quashed. The Court directed the employer to extend full maternity benefits under Sections 5 and 8 of the 1961 Act, after deducting any sum already paid, within three months.

The Court did not stop at Dr. Yadav. The reasoning applies to every contractual woman employee in India who fulfills the 80-day qualifying period. The message is clear: employers cannot use fixed-term contracts to evade maternity benefit obligations.

What this means for you

For advocates: This judgment is a powerful tool in maternity benefit litigation. When a contractual woman employee is denied full benefits because her contract expires during the maternity period, cite Dr. Kavita Yadav v. The Secretary, Ministry of Health and Family Welfare Department & Ors., 2023 LiveLaw (SC) 701. Argue that Section 12(2)(a) and Section 27 create a statutory fiction of continued employment for the purpose of maternity benefits. The employer's reliance on the contract term is a "discharge" under Section 12(2)(a) and is void under Section 27.

For CFOs and founders: Review your maternity benefit policies for contractual employees. If your contracts expire during the maternity benefit period, you are still liable for the full 26 weeks. You cannot prorate the benefit based on the remaining contract duration. The Supreme Court has held that the entitlement under Section 5(2) is not co-terminus with the employment tenure. Budget accordingly.

For HR professionals: Ensure that your maternity leave policy explicitly states that contractual employees who have completed 80 days of work in the preceding 12 months are entitled to full 26-week maternity benefits, regardless of when their contract expires. Any clause in the contract that purports to limit this entitlement is void.

The bottom line: A contractual woman employee who has worked 80 days in the preceding 12 months is entitled to full 26-week maternity benefits under the Maternity Benefit Act, 1961, even if her contract expires during that period — and the employer cannot use the contract's expiry to cut off those benefits.