The term ‘fringe benefits’ refers to the

extra benefits provided to employees in

addition to the wage or salary.
example :- use of work car for private
purposes, paid vacation, cheap loan, free
health and life insurance etc.
Most organizations in India have been
extending fringe benefits to their
employees, year after year, due to the
following reasons:-
 Employee demands
 Trade union demands
 Employer’s preference
 As a social security
 To improve human relations
 To motivate the employees by identifying
and satisfying their needs.
 To provide security to the employees like
old age benefit and maternity benefit.
 To protect the health of the employees and
to provide safety to the employees against
accidents.
 To promote employee’s welfare.
 To create a sense of belongingness
among employees and to retain them.
Broadly there are five categories of fringe
benefits:-
 Payment for time not worked
 Employee Security
 Safety and Health
 Welfare and Recreational Facilities
 Old age and Retirement Benefits