Performance or Variable pay is mandatory to pay during the Maternity Leave

Hi Team,

One of our Employees is on Maternity Leave and we are paying a Salary.

According to Labour law is it mandatory to pay Performance or variable pay to that Employee

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Performance or variable pay is purely at the discretion of the employer. This is a matter of company policy.


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It depends on what time of variable Pay you have committed to the employee.
Paying may not be mandatory if it is performance-based like a Sales target.

Some companies pay variable pay based on the company’s overall performance, in that case, you may have to pay it as these terms will be mentioned in the initial offer to the employee.

If employee is on ESI then esi will pay salary for 6 months

Dear Ramesh

As per Law it is not mandatory to pay Performance or Variable Pay during Maternity . It is completely based on management discretion.

I have got one query. Does a woman, who is in maternity leave, is eligible for performance appraisal and increment?

Of course yes. They are eligible.

Of course, yes. Appraisal can be based on the period the Employee worked and obviously past track record will contribute for the appraisal.

We practice this in our organization. Employees are primary assets for any business.

Hope this helps.

will that appraisal be done during her maternity leave or when she will resume at work that time only?

Performance review is not during Maternity leave and Rating usually average /Rating 3 since it’s counted as working period as per law.


Noted with thanks.