Employee benefits provide valuable services and programs to workers beyond traditional wages and salaries. Originally called "fringe benefits", they are now seen as an important part of the total compensation package. Benefits help retain employees, improve the organization's performance, and support workers' standard of living during difficult times. Common benefits include healthcare, insurance, retirement funds, time off, education assistance, housing, and special allowances. Providing benefits has objectives like attracting and retaining talent, fulfilling employee needs, enhancing the employer's image, and promoting worker welfare and productivity.

2. Meaning of Employee Benefits:
• In addition to compensation in the form of wages and
salaries, organizations provide workers with various
services and programmes known as employee benefits.
• Previously these services and programmes were known
as fringe benefits.
• Now these have become part of compensation package
hence the word fringe in now not used and not
appropriate even.
• Nowadays employee benefits are regarded as an
important tool to retain employees and to improve the
bottom-line of the organisation
5/15/2020 Amit Tiwari 2

3. Importance & Significance of Employees
Benefits
• Benefit programmes play a vital role to maintaining an
employee’s standard of living when he suffers from
health problem.
• The organisations that provide these benefits to their
employees have improved image of caring employer.
These benefits are the advantages that accrue to an
employee apart from salary.
• They are not related to performance.
• According to Cockman, “employee benefits are those
benefits which are supplied by an employer to or for the
benefits of an employee, and which are not in the form of
wages, salaries and time rated payments.”
5/15/2020 Amit Tiwari 3

4. According to C.B. Mamoria, employee benefits
are
• “primarily a means in the direction of
ensuring, maintaining and increasing the
income of the employee. It is a benefit
which supplements to a worker’s ordinary
wages and which are of value to them and
their families in so far as it materially
increases their retirement.”
5/15/2020 Amit Tiwari 4

5. Characteristic Features of Employee Benefits:
• (1) Employee benefits are those payments which
are paid to him in addition to the wages and
salary he receives.
• (2) These benefits are not given to the worker for
any specific performance of the jobs but they
offered boosting his interests in work and make
the job more productive for him.
• (3) Employee benefits represent labour cost.
Whatever benefits are offered to the employees
in kind or in money terms account for cost.
•5/15/2020 Amit Tiwari 5

6. In continuation….
• (4) These benefits are offered to
employees irrespective of their merit. Merit
or non merit is not the criterion for these
benefits.
• (5) Benefit given by the employer is meant
for all the employees and not a specific
group of employees.
• (6) This is a positive cost incurred by an
employer to finance employee benefit.
5/15/2020 Amit Tiwari 6

7. Common Employee Benefits:
(1) Free lunch or lunch at subsidized rates offered
to the employees.
(2) Free medical facilities to the employee and the
members of his family.
(3) Employees are insured for life against
accidents or illness. In India there is a provision for
this under Employees State Insurance Act.
(4) Provisions for retirement benefits such as
provident Fund, gratuity, pension etc.
5/15/2020 Amit Tiwari 7

8. ………in continuation
(5) Leave Travel Allowance scheme is implemented by many govt. and
non govt. organisation counts for paid holidays to the employees.
(6) Maternity leave for 90 days is given to female employees.
(7) Free education to the children of employees by providing
educational allowance to the employees. Scholarships to the
meritorious students of the employees are also given. Free transport
service is provided to the school and college going students of the
employees by the employers. This service is also provided to the
employees for attending their duties in the office or factories. This
service is provided freely in some companies and or at subsidized rates
in other organisations.
(8) Housing accommodation is yet another benefit provided to the
employees at subsidized rates.
5/15/2020 Amit Tiwari 8

9. Objectives of Employee Benefits and Service
Programmes:
The following objectives are achieved through benefit and service
programmes:
(1) To attract and retain the best employees in the organisation.
(2) To fulfill the needs of the employees which he himself cannot
provide such as protection against accidents and hazards?
(3) To provide employees with such benefits which are prevailing in
similar organisations.
(4) Special privileges are provided to the employees for holding a
special position in the organisation.
(5) Some benefits are provided at the behest of the unions first to
maintain good harmonious industrial relations.
5/15/2020 Amit Tiwari 9

10. Principals of Benefits
The principles underlying benefits are as under:
ADVERTISEMENTS:
(1) Benefits and services must be provided with the genuine intention of promotion of
employee welfare and these benefits should not be considered as a matter of charity.
(2) Benefits must be adored by the employees and should satisfy their need.
(3) The basis of benefits must be broad so that large number of employees should be
covered by them.
(4) Cost effectiveness should be taken into account while floating scheme of benefit.
(5) Employees must be aware of the use of these benefits.
(6) Effective planning for providing benefits should be effected.
(7) Before deciding upon any benefit the union should be taken into confidence and its
suggestion thereof should be taken into consideration. This facilitates smooth
functioning of the scheme.
(8) A quotation from Peter Drucker throws light on principles of benefits. He said,
“Larger part of industrial growth is obtained not from more capital investment but
from improvements in men. We get from men pretty much what we invest in them.”
5/15/2020 Amit Tiwari 10

11. ……Conti…
(6) Some special allowance provided to the employees to enhance their
standard of living so as to increase their quality of working life.
(7) Providing benefits to the employees enhances the image of the
organisation in the eyes of the people in general and the consumers in
particular.
(8) By providing benefits to its employees the organisation fulfill their
social commitment as contained in the Article 43 of the Indian
constitution which states, “— All workers should be given a living wage,
conditions of work ensuring decent standard of life and fuller enjoyment
to ensure social and cultural opportunities.”
(9) Benefits protect precious human resources during bad phases of life
or period of contingencies of life. These benefits keep the human
resources in ideal conditions which in turn increase the output. This is
must for increase in growth of economy of the country.
5/15/2020 Amit Tiwari 11

12. Thanks
Also can visualize the
same ppt based video on
youtube
https://www.youtube.com/
watch?v=YU1mfiyB07A
Stay Safe
Stay learned
5/15/2020 Amit Tiwari 12