Expanded Maternity Law: Good or bad for business?

Stories

Aaron Benedict De leonWritten by:

While many working mothers and women lauded the passage of the Expanded Maternity Leave (EML) Law, companies expressed their concerns on the impact of the new law to their respective businesses. These concerns are driven mainly by cost and productivity implications brought about by certain provisions of the EML Law. However, there are also potential benefits which may arise from the implementation of the EML Law, such as increased female employee morale and production, among others.

There are many ways to look at how the EML will impact a business.

The decision to provide a 105-day maternity leave entitlement for working mothers, instead of the international norm of 98 days, may have an impact on a company’s overhead and productivity. In situations where a working mother must take a prolonged leave, the company will be forced to either assign another employee to take over the tasks left behind or hire a new employee if the skill(s) required to do the work left behind is not available within the company. The costs may double as the employer has to pay both the mother on-leave and the relieving employee tasked to take over her responsibilities. Meanwhile, productive hours may also decrease, considering the learning curve of the employee assigned to take over the tasks left behind.

The decision to provide additional maternity leave benefit from 60 to 105 days may also positively benefit a business. Studies show that companies that offer paid maternity leave were able to reduce their female employee turnover, especially for those with special and firm-specific skills. With the implementation of the EML Law, new moms will be more focused on their work upon their return, given that they will have more than enough time to rest, recover and recuperate from the pains of child birth.

At the end of the day, companies should be geared for the implementation of the EML Law. The impact of the EML Law on a business will depend on the operational strategy to be undertaken by a company moving forward. This will entail a re-calibration of company structures, and require manpower rationalization to ensure production is consistent with the business requirements.

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