Independent Research Study

On

EMPLOYEE BENEFITS AND ITS EFFECTS ON EMPLOYEE PERFORMANCE

By

Preeti Anand
A010192319063

MBA Class of 2021

Under the Supervision of

Dr. Vijit Chaturvedi

Assistant Professor
Department of Human Resource

In Partial Fulfilment of the Requirements for the Degree of

Master of Business Administration – Human Resource

At

AMITY BUSINESS SCHOOL

AMITY UNIVERSITY UTTAR PRADESH
SECTOR 125, NOIDA - 201303, UTTAR PRADESH, INDIA
 DECLARATION

Title of Summer internship: Employee Benefits and Its ffects on Employee Performance

I declare

(a) That the work presented for assessment in this IRS Internship Report is my own, that

it has not previously been presented for another assessment and that my debts (for words,

data, arguments and ideas) have been appropriately acknowledged.

(b) That the work conforms to the guidelines for presentation and style set out in the

relevant documentation.

(c) The Plagiarism in the report is ___________ % (permissible limit is 15 %)

Date: ……………

Preeti Anand `

A0102319063

MBA-HR (Class of 2021)

 Abstract

In Human Resource Employee benefits are the basic key to motivate

employees. In the present time, HRs around the globe facing the problems of
employee turnover. The company hires best personal for the employee
compensations plans and tries to give maximum benefits to the best
employees so that they can retain candidates and lure in best candidates.
Here in my study, I tried to find out the best benefits that can be provided to
the candidates with 1 to 5 years of work experience. And what are the
benefits which are being preferred by the employee. Employee benefits
plays crucial role for the employees motivation and performance, from this
study the sampling method is used to find the employee benefits and its
effect to employee performance. For this study Statistical tool is used that is
SPSS by IBM.
Many prominent companies use these benefits to lure in best employees and
retain more and more new employees. Facebook is also taken into
consideration for the types of employee benefits because it has been marked
with high rating on Glassdoor, Indeed, Linkedin etc. Facebook has very low
Employee turnover ratio as well.
In the research the data is driven from the employee those who are working
in the company as an HR to find out the most preferable benefits by the
employees with 1to 5 years of work experience so that it can guide the
companies to can and attract young talent in the company.
 Introduction

An organisation is consisting of mission, vision and goals, for pertaining its

mission and goals the best contribution is done by human resource. In the
era of technology, the human resource is the most reliable source to the
company and the one way of keeping happy and healthy relation with the
employer is to adding lucrative benefits to every occupation. In the current
scenario, irrespective of the size, technology and brand image are facing
employee retention challenges, to overcome this issue company should
maintain the best relationship with the employer and to improve this strong
and positive relationship, the employer must be roused by the employee
benefits plans like execution bonuses, rewards and recognition study
allowance, leave allowance, retirement and investment benefits. To achieve
the objectives the company must form the policies and strategies to make
employee feel associated with the company. If employer is not happy with
their activity or work place they will put in little or no effort at work, or
switch job with better pay package. this can cost an organisation so much
particularly loosing a key and capable staff to a competitor.
2.1 Definitions
According to Wats0n (2013) Employee benefit plans concerned with
maintaining empl0yer-employee relationships that contribute to satisfaction,
productivity, m0tivation and moral to the employee.
According to the Wikipedia (2020), Employee benefits are the benefits that
include various types of benefits which is commonly called as fringe
benefits, perquisites and bonus for the better productivity of the employee
According to report of “CBU international conference on innovation in
science and education (2017)” Employee benefits are the part of motivation.
Employee motivation is the integral part of the Human resource, company
give these benefits to attract new potential employee and to retain current
employees.
2.2 Types of Employee benefits
 Base wage
Base pay is the fundamental money advantage that a business pays for the
work performed. Base compensation will in general mirror the estimation of
the work or abilities and for the most part disregards contrasts owing to
singular representatives. Base wage is fixed rate of the salary which is given
to the employees which does not include bonuses and other benefits or in
other words fixed remuneration to the employees.
 Incentives
Incentives are based on the performance of the employee, incentives is the
variable part of the salary based on the performance of the individual, group
of individual or based on the target completion of the team. Company
incentivise the employee for the motivation of the employees
Long term incentives are aimed at the employee efforts of many years
outcome. Driving supervisors or experts are habitually offered stock
proprietorship or rewards to concentrate long term organizational motives
such as market share, return on net assets and ROI. Coca-Cola awards
portions of stock chosen be as "key contributors" those who make
outstanding performance to the company's prosperity. Pepsi, Microsoft, and
Proctor & Gamble also offer investment opportunities to all their employees.
These organizations think that a stake in the organization endorses a culture
of possession. Workers will perform like proprietors
Incentives and basic pay are different from each other, although they both
impact performance and future behaviour. The difference is the time of the
computation, basic pay is intimated earlier and incentives are computed after
the performance and given may be quarterly half yearly or yearly.
 Medical services
Medical services cover the consultation fees, prescribed drugs fees, surgery
fees, and the cost of the hospital rents. Furthermore, it may cover dental and
optical charges, but not in general medical services. Medical services may
extent to the to family members also.

 Disability Insurance
In this company helps to cover the full or the fraction cost of the disabled
person. Only if a person is injured or wounded at the time of working hours
and the premises of the company. This is mainly differentiated as long term
and short term disability.
 Retirement Benefits
These benefits are provided to the employer after the end of their career in
form of pension or income. Companies rarely use this type of benefit now a
days.
 Life Insurance
Life insurance is given to the employees after the demise of the employee to
support his family by giving them insurance money. This may be given in
single instalment to the inheritor.
 Paid Time Off
The paid time off are the basic type of the benefit which is given to the
employee while working in the organization like leisure leave, festive leave,
sick leave.
 Fringe Benefits
Numerous types of benefits are given to the employee to persuade the best
talent in the company and lure in more candidates. These benefits are termed
as fringe benefits like giving employee house in the posh location, this also
include child’s tuition fees, day care assistance facility at the work place.
Many companies like Google, Facebook allow pets to bring at the
workplace.

\
 Literature Review

In this chapter, existing work written by researchers and some articles on

Employee benefits and narrowed it down explicitly to the productivity and
proficiency. Various types of employee benefits programs are discussed and
its impact on productivity are all around sketched out and expressed.
 Society of Human Resource Department (SHRM) Survey Report
(2019)
Acc0rding t0 the rep0rt, Empl0yee benefit survey was c0nducted with 2763
resp0nses 0n the different benefits pr0vided t0 the empl0yee. Res0urces are
decreased and increased to record the behavi0ur 0f the empl0yees. In the
respect 0f the health benefits 86% responded it very crucial for the
workforce when people are asked about the health care facilities, around one
fifth of the companies reported hike in the facilities since 2k18. In the
respect Of Retirement benefits, appr0ximately all 0rganizati0ns 0ffer
retirement plans, Ninety three percent 0ffer traditi0nal 401K plans, a slight
increase Over the earlier five years. Retirement plans, has decline over the
last 5 years of time. Employee asked for the tuition fee assistance from the
company from this it is clearly driven people more than half want
educational benefits. More than half of the population, Empl0yee charitable
giving 0r d0nati0ns f0r empl0yee participati0n in charitable Occasi0ns are
available at a min0rity 0f Organizati0ns, alth0ugh they’ve seen s0me decreases
0ver five years. H0wever, paid time Off f0r v0lunteering has impr0ved Over
this time, Twenty Six percent Of Organizati0ns. Pr0grams p0inted Out On
particular health c0nditi0ns (Twenty four percent) Or health screening
(Thirty-One per cent) have seen deteri0rati0ns as insurers have m0ved int0
this space, while benefits like quiet rooms (Twenty one Percent), fitness
activities (Thirty per cent) and standing desks (Sixty percent) have seen
increases. Paid maternity break is Offered by thirty four percent 0f
Organizati0ns, now paid paternity break is being offered by more than 30%
of the companies
  “EMPLOYEE BENEFITS AS ONE OF FACTORS OF WORK
MOTIVATION”
“According to the study BY Nátalia Stalmašeková1 , Tatiana Genzorová2 ,
Tatiana Čorejová3 (2011), human resource is the important resource for the
company and for the successful business it should have best employees, the
employee benefits are used to lure in new employees and to retain existing
employees. In study, they have stated all the employee benefits are offered
in the Slovakia such as Corporate teambuilding, employee educati0n,
Education of empl0yees includes training in their pr0fession (meetings,
worksh0ps), but especially the teaching of f0reign languages. And then they
give education about other languages, in caser the employers have to travel
to other country. Another benefit which is useful to employers are the
flexible working hours. On the other hand, the employee benefits offered in
USA such as, dental and vision insurance, better health facilities, increased
flexible h0urs, W0rk fr0m h0me Unlimited vacati0n Student l0an assistance
Retirements savings PC f0r private purp0se Paid maternity/ paternity leave,
Free gym membership Free day care services. Then research was conducted
with the sample size of hundred than the conclusion was made that the
cafeterias and one meal of the day should be provided by the company and
that is the main trigger of the employee benefits plan and employees more
attract towards the free meal once a day.”

 “Employee Benefits and its Effect on Productivity at Semcon India

Private Limited, Bangalore” (2018)
According to the Article, the survey conducted in Semcon India pvt. ltd with
one hundred and eight respondents with all the benefits given to the
employee tried to find the motivation and the job satisfaction. SPSS was
being followed for the results and the tools that were used are chi square and
correlation. And concluded that compensation, Base wage, fringe benefits
are deeply connected to the performance of the employee.
 “Employee Turnover and Organizational Performance: Testing a
Hypothesis from Classical Public Administration”
Acc0rding t0 the j0urnal, the relati0nship between turn0ver and perf0rmance at
the 0rganizati0nal level. Organizati0ns als0 assign managers, supp0rt
pers0nnel, external relati0ns specialists, and Other types Of empl0yee. In
additi0n t0 the crucial questi0n 0f whether Or n0t turn0ver affects perf0rmance
in the same way f0r these types 0f pers0nnel, pr0bing h0w turn0ver am0ng the
vari0us gr0ups interacts t0 affect Organizati0nal perf0rmance w0uld als0 be
w0rthwhile. The Organizati0nal fact0rs influence the relati0nships examined
in this study. Such fact0rs as Organizati0nal size, administrative pers0nnel
versus the relative distributi0n 0f pr0ducti0n, Organizati0nal slack,
Organizati0nal gr0wth versus stability versus decline, and many Other fact0rs
c0uld affect the turn0ver-perf0rmance relati0nship.

 According to Frank Giancola (2013),

To design an effective benefit plan it is important to know delighted with
the already existing benefit plan. If the firms, regularly does the survey on
both the question, with their intelligence they can make or design benefit
plan which can satisfy everyone. But unfortunately, the surveys are not done
on regular basis by the employers. From the surveys, 38% of the employees
were satisfied with their wages. The overall conclusion from the study was
employees are satisfied with their benefit plans. But there low in satisfaction
when it comes to rising healthcare costs and premiums. The survey shows
that employee benefits are important for satisfying and lure in new
employees. The survey also points to the beneficial plan which the employee
thinks or considers being more important than the other. The organizations
which have satisfied employees are more productive in their work when
compared to fewer satisfaction levels.

 According to Jaya Bhalla (2015),

flexible working arrangements can influence directly or indirectly to the
improvement of the individual as well as organisation and social wellbeing.
Initially the adaptability in the work put was presented for ladies by giving
her the maternity leave and a few relaxations at the working work station.
Many companies have begun to offer flexible work hour arrangements to
help employee to balance their work and family demands. Flexible working
arrangement are defined as employer provided benefits that permit some
level of control over when and where they work outside of the standard
workday. This examination extends up to the connection among free and
wards factors. The investigation is explanatory in character or reason as
diagnostic research includes inside and out examination and assessment of
accessible data trying to clarify complex phenomenon. The study mainly
depends on data collection from primary sources through questionnaires that
is specially designed for the study. Five-point Likert scales have been used
in the questionnaire to measure effect of flexible working arrangements on
employee productivity.
 Marilyn Spencer, Deniz Gevrek et al., (2015),
The study was done by surveying employees of a public university. The
study showed that the employers who offer robust benefit plan have satisfied
employees who are more likely to stay in their present job. The cost of
employee resigning and a new recruitment which replaces the resigned is 20
percent. The one way to tackle this problem was by providing robust
employee benefit plan. Then those employees who are not satisfied with
their benefit programs. The study measures two ward factors, representative
efficiency and worker maintenance. For the organizations of advanced
education, representative maintenance and their profitability are need. The
result suggests that, annual salary, waiver on tuition and dependents are
significant to raise productivity as well as encourage them to retain for
longer at their present job. The major conclusion from the study was by
introducing new tuition waiver which is relatively low cost will help in
employee retention and productivity.
 Stephanie C. Kern (2013),
There is very limited studies done on job satisfaction when it comes to
women and even less when we consider women in the manufacturing sector.
The objective of the study is to examine whether there is a relationship
between job satisfaction and benefit gave to the women employee in the
manufacturing sector. There is a significant increase in the number of
women employees. The studies conducted earlier showed that women
employed in manufacturing and other physically demanding jobs are not
happy with employee benefits. Earlier studies have also shown that women
employees are more satisfied with their employer if work-life balance issues
are dealt with. The method followed was collecting data from surveys from
the entire employee. Online tools to retrieve data from the survey were used
to gather data. The answer was collected for both male and female
employees later the data was narrowed it down to female employees. The
study emphasized that the job role is very important in job satisfaction.
  Michael Custers (2013),
The benefits which helps employees to maintain their work life balance are
used to motivate employee and improve their performance. By proving these
benefits employers work with their heart and brain with their best
capabilities which also helps the companies to get best employees. The
benefits which are not so important can be made with the help of HR
technologies. The compensation and benefits can be survey through HR
technologies and get to know the impact of the of the benefits to the
employees.HR learning tools can also help the organization to do training
assessment needs. Flexible working hours can be more beneficial to the
employee and helps the client to be available at the peak hours. Attendance
based HR solution helps the HR to tell the employee to rest at the non-peak
hours and can take a leave and can also work from home for 3 days a week.
According to the study, the more productivity is being measured at the time
of work from home.
 Research methodology

Introduction
This chapter involves the methodology of the research. It shows the various
techniques and the methods followed in the research. This is followed by the
research objective, hypothesis, scope, significance, data collection method.

Research Design

“The exploratory and qualitative research design was used to assess the more
accurate and unbiased finding. The researcher tried to give new dimension to
the study. Primary as well as secondary data has been used. The primary
data was collected through google forms and secondary data is collected
from Internet, journals, case study, Research papers, career portals.”

Sample size and Technique

“For this purpose of research, sampling method has been used, therefore 57
respondents are used for the analysis. At this student level the data collection
from the professionals is a difficult task. The technique used for the data is
SPSS for the descriptive analysis and Hypothesis.”

Research Objective
 Primary objective of this study is to find the employee benefits and its
effects on the employee performance
 Which Employee benefit is preferred by the employees in 1 to 5 years
of work experience?

Scope of the study

This study will help to implement the necessary changes to be done in the
company to know ow to attract the new potential employees and what types
of benefits they can offer to employee and help to retain the old employees.
Significance of the Study
This study highlights the importance of employee benefits and what changes
they can implement so that the employees feel motivated and how company
can retain employees for the longer period of time.

Data Collection method

To fully assess the data and to find the un-biased result primary as well as
secondary method of the data is used like Articles, journals, research papers,
company reports, data collected from company sites, Internet.
Primary Data: The data is collected from cooperate culture employees
through questionaries3. with 1-5years of work experience to fulfil the
objectives.
Secondary Data: To refer the existing work on internet, Articles, journals,
research paper, company reports to refer what kind of benefits they already
offer to retain their employees and to lure in new employees.

Questionnaire
https://forms.gle/o3K6WoMTPyQKRNxV8
 Data analysis and Interpretation

INTRODUCTION

The data presented here are those collected from the primary and
secondary sources of data through the questionnaire prepared with 64
respondents wherein 57 respondents have the 1-5years of experience.

PRESENTATION TABLE

“Does your organization provide its staff with benefits and incentive?”

Frequency Percent Valid Percent Cumulative

Percent

1 1.8 1.8 1.8

Maybe 8 14.0 14.0 15.8

Valid NO 8 14.0 14.0 29.8

Yes 40 70.2 70.2 100.0

Total 57 100.0 100.0

According to the Data, 70.2% of HRs indicated that they provide employee benefits to
their employees. Whereas 14% said No and 14% said maybe.

“Do you believe that Employee benefits affect employee performance?”

Frequency Percent Valid Percent Cumulative

Percent

May Be 8 14.0 14.0 14.0

No 5 8.8 8.8 22.8

Valid
Yes 44 77.2 77.2 100.0

Total 57 100.0 100.0

According to the data, 77.2% of the HRs believe that employee benefits have the effect
on the employee performance.
 “Do you believe that the benefits package is important to the employees’
loyalty?”

Frequency Percent Valid Percent Cumulative

Percent

No 9 15.8 15.8 15.8

Valid Yes 48 84.2 84.2 100.0

Total 57 100.0 100.0

According to Data, 84.2% of HRs said “that benefit package is important to the employees’ loyalty.

Descriptive Statistics

N Minimum Maximum Mean Std. Deviation

Medical
57 1 5 3.71 1.082
Insurance/Healthcare
Cab service 57 1 5 3.51 1.104
Eye Insurance 57 1 5 3.60 1.083
Maternal/paternal Leave 57 1 5 3.69 1.158
Stock Options 57 1 5 3.88 1.119
Educational 57 1 5 4.02 1.188
Short- or Long-Term
57 1 5 3.89 1.160
Disability
Meals 57 1 5 4.02 1.188
Paid Leave 57 1 5 4.09 1.258
Sabbatical Leave 57 1 5 3.96 1.180
Regular yearly Hike 57 1 5 4.19 .934
Incentives/Bonus 57 2 5 4.26 .813
Valid N (listwise) 57

The lowest mean is of Cab services is 3.51 and maximum of Incentives/

Bonus is 4.26 followed by regular yearly Hike. The benefits which are more
preferred by the employees are incentives/Bonus and regular yearly hike.
 Conclusion and Recommendations

Conclusion: The first objective was to find out that employee benefits plans
and its effects on the employee performance. From the survey it is proven
and first objective is met.
For the second objective the most preferable benefits to the employees with
1-5 years of the work experience. Incentives/bonus is most preferable and
followed by regular yearly hike as it has the highest mean 4.26 followed by
4.16.
Benefits Mean
Incentive/Bonus 4.26
Regular yearly hike 4.16
Paid leave 4.9
Educational Benefits 4.02
Meals 4.02
Sabbatical leave 3.96
Stock options 3.88
Medical Insurance 3.71
Maternal/paternal 3.69
Leave
Eye Insurance 3.60
Cab service 3.54

The above table shows the preference of the employees with 1-5 years of
Work experience

Recommendations: The following suggestions would be made to guide

management in trying to evolve an effective motivational policy for their
workers.
 Employees who are due for promotion should be considered.
 Pay package should be reviewed regularly.
 Rewards should be a function of actual performance.
 Incentives/bonus should be extensively followed to retain the
employee for longer period of time.
Limitation:
At the student level, we can only find the working professionals through
social platforms. Since there were only 57 respondents which is low in
number.
 References
[ CITATION Sum19 \l 16393 ]

[ CITATION Ali07 \l 16393 ]

[ CITATION Hir11 \l 16393 ][ CITATION EXE19 \l 16393 ][ CITATION Emp11 \l 16393 ][ CITATION
NZA19 \l 16393 ][ CITATION Jam08 \l 16393 ][ CITATION HEL13 \l 16393 ]

https://www.businessinsider.in/a-top-financial-adviser-says-we-should-all-
expect-to-work-until-were-105-and-thats-not-a-bad-
thing/articleshow/60126527.cms
https://www.vanityfair.com/news/2018/10/snap-employees-look-for-a-way-out-
before-the-walls-cave-in
https://perks.guide/
https://en.wikipedia.org/wiki/Facebook
https://en.wikipedia.org/wiki/Snapchat
https://www.glassdoor.co.in/Benefits/Facebook-US-Benefits-
EI_IE40772.0,8_IL.9,11_IN1.htm
https://www.indeed.com/cmp/Facebook/reviews
https://www.hrtechnologist.com/articles/workplace-wellness/four-employee-
benefits-trends-to-watch-in-2019/
https://economictimes.indiatimes.com/news/company/corporate-trends/in-times-
of-covid-19-crisis-top-companies-give-priority-to-employees-
wellbeing/articleshow/74964709.cms?from=mdr
https://www.academia.edu/25932687/employee_benefit_and_its_effect_on_em
ployee_productivity
https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/employers-
boost-benefits-to-win-and-keep-talent.aspx
https://www.cnbc.com/2018/12/02/facebook-employees-calling-former-
colleagues-to-look-for-jobs-outside.html
https://business.linkedin.com/talent-solutions/blog/employee-
retention/2018/facebook-secret-to-increasing-
retentionhttps://www.hrtechnologist.com/articles/workplace-wellness/four-
employee-benefits-trends-to-watch-in-2019/