Two decades ago, few corporations extended employee benefits such as paternity leave, or maternity leave for female employees who adopted children. Today, such perks are much more prevalent in the Indian corporate world, at least among the larger corporations. Many of these practices followed the proliferation of new multinationals, especially in the IT and IT-enabled services businesses where the competition for talent was fierce.
Indeed, these two sectors can be credited with many of the relatively lavish benefits that were showered on employees as private corporate activity began to expand in the decade after 1991 (the public sector has always been a generous employer). Employee stock option schemes, or Esops, of course, were the most visible among the emerging perks until tax laws crimped their attraction. But overall, it would be fair to say that executives in large private corporations – whether domestic or multinational – enjoy many more benefits for themselves and their families than did their forebears of a generation ago.
Obviously, the scale and lavishness of employee benefits are very much the product of the competitive paradigm in which the company operates and its profitability. But for the most part, corporations tend to be fortresses of social conservatism as far as the direction of employee benefits goes. Rarely do they proactively respond to social change for its own sake.
The introduction of paternity leave is a case in point. The explosion of nuclear families and working couples were growing trends since at least the eighties. That meant new fathers had to bear a larger share of infant care than, perhaps, their own parents did, and needed time out to do so. Yet, the perk proliferated in corporate India only in this century and that too on the back of the new multinationals that entered India, bringing global best practices with them.
The same goes for extending maternity leave to women employees who choose to adopt children. The practice of adoption is hardly new, but the recognition that women needed time out for child care is. That is why the extension of the benefit in corporate India is of a much more recent vintage and it is still relatively rare.
On the whole, and depending on the outlook of the management, corporations tend to extend benefits to the employee’s spouse and dependent children and parents. Since middle-class India is still relatively conservative in its outlook, this model is rarely questioned. But economic liberalisation is influencing – as it is bound to – societal changes in middle-class attitudes.
Signs of this can be seen in the big cities, where live-in relationships and single parenthood are no longer as secretive or taboo as they were a decade earlier. Another symptom is the decriminalisation of gay sex among consenting adults by the Delhi High Court in 2009. Earlier this year, hearing an appeal against the high court’s verdict, a two-judge bench of the Supreme Court made the prosaically realistic observation that homosexuality had to be seen in the context of a changing society. Practices that were unacceptable two decades ago are acceptable today — and the judges included live-in relationships and artificial insemination in that list.
Recognition of “common law” and “domestic partners” (same-sex and hetero) is now standard practice among corporations in Europe and the US, especially for health and medical insurance. The terms are clearly defined and so are the benefits (companies even specify whether recognised non-married partners are entitled to attend functions such as off-sites and so on). What is more, the trend appears to be accelerating. A study of 3,000 large US employers by Mercer last year showed that more than half the sample offered health benefits for domestic partners, up from one-third just the year before.
Much of this is mainly, employers admit, on account of the heightened competition for good talent. Few companies are as enlightened as, say, IBM, one of the first US corporations to add sexual orientation to its non-discrimination policies. Big Blue introduced domestic partner benefits for gay people in 1996 (piquantly, when New York and Massachusetts legalised gay marriage, IBM stipulated that same-sex couples in these states had to get married to qualify for benefits.)
In India, many of these issues have yet to acquire the currency of social acceptability; in the case of same-sex relationships at least they will have to work their way through the law courts. Tax laws, too, will need a relook: for instance, how should domestic partner benefits be treated for tax? In the US, an employee has to include the cost of domestic partner benefits as taxable income but is exempt if the partner is registered as dependent.
So, true, many of these social changes are still incremental in India. But anyone looking over the first decade of the 21st century will attest to the accelerated speed of social change in urban corporate life, where corporate offices are located. Which means managements in corporate India will have to respond to them sooner rather than later.