Understanding Employee Welfare: Meaning, Objectives, and Types

Employee welfare, also known as staff welfare benefits, is the services and benefits offered by employers for their employees' well-being. These benefits include healthcare, paid leave and various other amenities. These services benefit employees' mental and physical well-being and help create a satisfied work environment.

Employee welfare plays a crucial role in employee retention, especially at senior levels. Organisations know the difficulty of hiring senior-level employees. Thus, providing better employee welfare with a good package helps in retaining employees for a long duration.

Several objectives of employee welfare benefit employees, employers, and society as a whole. Let us understand them.

-Providing a Good Working Environment: The foremost objective of employee welfare is to provide a safe and secure working environment for employees. This prevents injuries, accidents and illnesses in the workplace.

-To Support Personal and Professional Growth: Employee assistance and training programs help them tackle their personal and professional issues. This includes providing employees with enough resources to upskill themselves and progress in their careers.

-Providing Work-Life Balance: Employee welfare programmes like flexible work schedules, parental leaves, mental well-being leaves, etc., help maintain a healthy work-life balance. They boost not only employee productivity but also morale.

-Reducing Influence of Trade Unions: Trade unions work for employee betterment and negotiate on their behalf. Employers can reduce the involvement of trade unions by including different types of employee welfare schemes in their packages. This will reduce the influence of unions on employees and help foster better working relations with employers.

-Promotes Company’s Philanthropic Deed: Providing employee welfare helps promote the company’s philanthropic activities. It not only creates a better image of the company to attract new talents but also promotes a positive environment within the company among current employees.

-Also Read: Employer Employee Insurance Scheme: Eligibility and Benefits

-Statutory Employee Welfare Benefits

Statutory employee welfare is also known as mandatory welfare benefits. These are government-mandated programs that employers must provide to their employees for their protection and overall welfare. They include health and safety regulations, maternity leave, proper hours of work, a sanitised workplace, etc.

-Voluntary Employee Welfare Benefits

Voluntary employee welfare is the benefit that employers provide to their employees with their willingness. The government or any other law does not mandate these benefits; employers provide voluntary benefits out of concern for their employees.

Such benefits include wellness program subscriptions, up-skilling workshops, mediclaim insurance coverage, subsidised meals at corporate office canteens and more.

-Mutual Employee Welfare Benefits

These types of employee welfare measures are provided through mutual decisions between employees and employers. These schemes benefit both parties and improve the employee experience. They include mutual benefit funds with the company, employee-run cooperatives and profit-sharing plans.

There is a strong emphasis on employee welfare for various reasons; let us know them.

-Low Awareness and Literacy:

India has a lot of low-literacy employees in various sectors and cities. A strong employee welfare program ensures that such employees who lack awareness about their rights and benefits are not disregarded. Thus, with employee welfare programs like upskilling programs, health insurance, provident funds, etc., they can be compensated properly in addition to their salary.

-No Strong Trade Union Movement:

Although there are various trade unions, there has been a lack of strong trade union leaders and movements that can make the workers stand up for themselves. Thus, to fill this gap, strong employee welfare benefits were introduced. These not only provide employees with a better working environment but also empower them to take a stand for their mandatory benefits and rights.

-To Train Employees:

Several studies have shown that the Indian workforce lacks skilled employees who know how to do a job. Various types of employee welfare programs, such as training workshops, skill resources, employee course materials, etc., will not only benefit the employee for career advancement but also help the employer get skilled and trained employees.

-To Counter Improper Health Facilities:

Employees in various sectors are usually unable to access hygienic workplaces or proper health facilities after any work-related hazard. Employee welfare programs mandate that employers provide a hygienic and safe working environment to their employees. Good workplace situations not only help avoid work injuries and accidents but also boost employee morale to work productively.

Also Read: What Are the Benefits of Employee Assistance Programs?

-Promoting Better Recreational Activities:

Due to a lack of employee recreational activities, workers of organisations tend to be involved in futile activities. Through different recreational and employee welfare programs, employers can ensure that employees stay engaged in productive activities, which positively benefits employee efficiency.

Employee welfare measures always evolve with changing times and the need to retain the best talents. Knowing welfare objectives, their importance and their types helps employers make informed decisions about their organisations.

Moreover, employees can also benefit from this information by choosing the right employer for themselves and knowing their rights and benefits provided to them.

Also Read: How to Manage Employee Health for Better Productivity?

Employee retention and providing them with the best benefits have become goals for every other organisation. The reason behind this is to cut the high employee turnover rate and attract the best talents. Providing group health insurance is a part of this effort.

This insurance is beneficial for both employers and employees. A group mediclaim policy ensures that employers fulfil their legal and moral obligations in case of any unforeseen event with employees. It is also beneficial for employees as group mediclaim policy provides them with financial and medical assistance when required.

With the TATA AIG group health insurance, employees get comprehensive coverage for themselves and their family members.

Moreover, with our group health plans, employees also benefit from pre-existing disease coverage from day one of getting insured.
Our SME insurance plans help businesses maintain business continuity even in times of adversities and mishaps.

What is the difference between labour welfare and employee welfare?

Employee welfare includes the fringe benefits provided by the employer to their employees. On the other hand, labour welfare is a broad term that includes various benefits and activities like social security, medical aids, recreation, housing, adult education housing, etc.

What is LWF in salary?

LWF, or Labour Welfare Fund, is a payroll statutory fund that ensures employees' social security and improves their working conditions.

Is staff welfare taxable?

Several types of staff welfare benefits help improve employee satisfaction and productivity. Depending on the category, many of these benefits are fully taxable or partially taxable.