Section 70: Forfeiture of maternity benefit

The Code on Social Security, 2020 (Act No. 36 of 2020) • Official Statutory Text & Plain English Practice Guide

Statutory Mandate
Chapter VI: Maternity Benefit
Competent Labour Forum
Act No. 36 of 2020

Legal Commentary & Landmark Judgments: Section 70

Section 70 of the Code regulates the forfeiture of maternity benefit, providing that an employee shall forfeit her right to maternity benefit if she works for remuneration in any other establishment during the period of authorized maternity leave.

  • Strict Bar on Dual Employment During Maternity Leave: Prohibits female employees on paid maternity leave from taking up paid employment in another enterprise during the leave period.
  • Statutory Forfeiture Remedy: Authorizes the employer to stop maternity disbursements and forfeit the remaining benefit if conclusive proof of alternate gainful employment is established.
  • Requirement of Fair Hearing Before Forfeiture: Obligates the employer to issue a formal show-cause notice and provide a fair opportunity to respond before declaring benefits forfeited.
Key Landmark Precedents:
  • B. Shah v. Presiding Officer, Labour Court (1977) 4 SCC 384: Supreme Court affirmed that maternity benefit is intended to provide rest and infant care; engaging in alternate commercial labor defeats the statutory object.
  • Municipal Corporation of Delhi v. Female Workers (Muster Roll) (2000) 3 SCC 224: Affirmed that social security benefits must be enjoyed for their bona fide statutory purpose.
  • Jaswant Mills v. Presiding Officer (1996) 2 SCC 71: Reaffirmed that forfeiture of statutory labor benefits requires strict adherence to natural justice.
Courtroom Practice & Strategic Litigation Guidance:

Never execute a summary forfeiture of maternity pay based on rumor. If an employee is suspected of moonlighting during maternity leave, conduct an internal inquiry, issue a show-cause notice with tangible documentary proof, and pass a reasoned order under Section 70.