In the rush to achieve targets, how startups are leaving their women behind
When the Maternity Benefits Act was amended in March 2017, paid maternity leave was extended from 12 weeks of paid leave to 26 weeks. The amendment again sparked the discussion around why many startups cannot afford to implement the mandated policy of paid maternity leave.
To not compromise with the newly set maternity leave period, the Ministry of Labour and Employment stated that it is considering a proposal to create a corpus of around Rs 400 crore to reimburse startups for the extended seven weeks.
According to community network platform Local Circles, the proposal has not seen the light of the day yet. A majority of the businesses have told the platform that there has not been any clarity on the rule.
The platform stated, “Early-stage startups and small businesses are feeling the heat and pressure of this amendment, owing to the extra financial burden on them.”
To assess the impact of this amendment in the last 12 months, Local Circles conducted a survey among startups and small and medium enterprises (SMEs). It saw 8,500 responses from startups, SMEs and entrepreneurs from across that country.
Business or diversity: the startup dilemma
Shilpi Sinha, 27, manages a team of about 15 people and has successfully clocked Rs 76 lakh in two years through her startup, The Milk India Company. Currently, the entrepreneur is looking to raise funds and hire more members to her internal team based in Sarjapur, Bengaluru.
The hiring process, she said, is based on talent and has nothing to do with the gender. In fact, according to her, bachelors – men or women - are the ideal candidate who “run for the passion and have limited familial responsibility”.
“For a startup that is bootstrapped, paying for six months and not having them work with us would be a huge risk. We cannot afford that and it is a full-time responsibility for the employee and we just cannot afford it,” she emphasises.
Shilpi is chasing productivity for the expense she incurs in the form of the salary paid to her employees, and she is not the only entrepreneur doing so.
The survey reveals that as many as 33 percent of early-stage startups said that they did not hire women at all while 16 percent confessed to having hired fewer women than they did in the previous year.
“The whole thing about maternity and the leave period is a big thing for a woman in her life. As a woman, I believe it is really important that the leave is extended. However, as an entrepreneur, startups need a person to physically and mentally be in the office,” says Samiskha Bajaj, Co-founder of Delhi-based fashion tech startup called Samshék.
Founding the company with her brother, the entrepreneur employs over 25 full-time professionals and works with nearly 15 freelancers. At present, they prefer hiring unmarried women.
“Even after giving six months of maternity leave, women still need to give their babies at least two to three years of their lives. Despite people saying that a person can come back and manage, if her baby is not keeping well, her productivity will go down. In this phase, a woman has to keep one priority, either family or work,” she says.
Samiksha adds that while six months’ paid leave for mothers is a definite concern at this stage of the startup, it should be fine 10 years later.
Active entrepreneur Faizal M Khalid, who co-founded growth hack startup Maplitho, shares that one of the employees who is currently on maternity leave continues to contribute to the startup by working from home.
This reveals how a policy designed to favour women to cope with motherhood has become a threat and challenges their professional careers.
Mothers who take a break from their career due to childcare also face a tough time in rejoining the workforce. Entrepreneur Neha Bagaria realised that this was is a shared challenge among mothers and married women and it led her to start the JobsForHer platform.
The entrepreneur remarked that the idea was to change the employer’s mindset. She convinced them to hire the returnees for their talent rather than treating it as an act of social goodwill.
Sukriti Saroj, who works at Social Alpha, an investment fund enabled by Tata Trusts and the Government of India, reflected similar concerns. “Women are known for their commitment and dedication towards work, and they excel across fields including leadership qualities but if you see the trends in maternity and post that, they have seen a drop in the number of working women. Many do not pursue their career.”
Stating that not all women can be hired by flexible workplaces like government bodies and multinational companies, she urges the startup economy to find ways to support maternity.
At the same time, she admits that doing so has been an ongoing debate for the last four to five years. “We want to support diversity, equality, and empowerment, but from a startup’s perspective, those in the early stage are struggling to raise funds and are on a treadmill to meet certain milestones or numbers,” she adds.
Sukriti says, “In the last few years, I have not come across any disbursement plan or salary for maternity. I would love to see the focus there and be transparent and open to us investors because, in the end, we are humans first.”
And some startups are taking steps to in the right direction. Deepak Singh Ahlawat, CEO of Purple Quarter, shares that there is no other way and they consider it important to provide the six months' paid maternity leave. Even while hiring, "we do ask what their family members do but we don't ask if they are planning to have a child. I think's that is too rude to ask," he says.
She adds that the investors too have a dearth of money coming from family offices, a network of angel investors, philanthropic capital, and venture capital.
Perhaps, they can help lead the change by planning for maternity payments in their funding.
(Edited by Kanishk Singh)