Employees’

Welfare &
Social Security
 Concept of Employees’ Welfare
The terms labour welfare, employee welfare, and worker
welfare are all synonymous. They refer to the various
benefits and services employers provide to their workforce
in addition to their salaries. Think of it as an investment in
employee well-being. As Arthur James Todd explained,
labour welfare encompasses anything done beyond the
basic requirements of the job to improve employees' lives,
whether it's for their comfort, intellectual development, or
social well-being.
The International Labour Organization (ILO) broadens this
definition to include services, facilities, and amenities. In
their view, worker welfare is about creating a positive work
environment both within and around the workplace. This
includes ensuring a healthy and peaceful atmosphere and
offering amenities that boost employee health and morale.
Labour welfare is a growing concept that provides
additional benefits and services beyond wages. These aren't
handouts, but investments that improve employee morale
and, in turn, benefit the organization through increased
productivity and employee loyalty. While not directly
motivational, welfare services are essential for a healthy and
productive workforce.
The basic features of employees
or labour welfare are as follows:
Labour welfare includes various facilities, services and
01 amenities provided to workers for improving their health,
efficiency, economic betterment and social status.

Welfare measures are in addition to regular wages and other

02 economic benefits available to workers due to legal
provisions and collective bargaining.

Labour welfare measures are flexible and ever-changing. New

03 welfare measures are added to the existing ones from time to
time.

Welfare measures may be introduced by employers,

04 government, employees or by any social or charitable agency.

The purpose of labour welfare is to bring about the

05 development of the whole personality of the worker to
make him a good worker and a good citizen.
Scope of Employees' Welfare
The Labour Investigation Committee preferred to
include under labour welfare "anything done for the
intellectual, physical, moral and economic
betterment of the workers, whether by employers, by
Government or by other agencies, over and above
what is laid down by law, or what is normally
expected on the part of the contracted benefits for
which workers may have bargained." According to
the Committee on Labour Welfare, welfare services
should mean 'such services, facilities and amenities
such as adequate canteens, rest and recreation
facilities, sanitary and medical facilities, arrangements
for travel to and from the accommodation of workers
employed at a distance from their homes and such
other services, amenities and facilities including
social security measures, which contribute to
conditions under which workers are employed.
 Labour welfare activities may be
classified into two categories, viz.,

Statutory Welfare Activities voluntary welfare activities

Statutory welfare activities have to be Voluntary welfare activities are undertaken

taken up by every employer as per the by the employers without compulsion of
provisions of various labour enactments. any law. They include such activities
Such provisions may relate to working conducive to the welfare of the workers
conditions, hours of work, industrial safety which are undertaken by the employers of
and various other facilities to be provided their own free will. They are also taken up
to the workers to make their work smooth by some social organisations.
and enjoyable. For example, the Factories
Act, 1948 provides for several welfare
activities such as the provision of drinking
water, cleanliness and sanitation, canteens,
creches, medical and education facilities,
first aid appliances, recreational facilities,
amusement, games and sports, housing
accommodation, etc.
 Importance of Employees’
Welfare
The important benefits of welfare services are given below:
Welfare facilities provide better physical and mental health to
the workers and make them happy.
Service facilities like housing schemes, medical benefits,
education and recreation facilities for the workers' families help
create contented workers' families. This will help them to
devote greater attention towards their work. The gain in terms
of productivity and quality of work will be large indeed.
Employee services serve to maintain some degree of peace
with the employees' unions in as much as these constitute a
considerable part of the bargaining package. The harmony and
the good relations that result are the kingpin of higher
productivity.
Employers get a stable labour force due to the provision of
welfare facilities. Workers take an active interest in their jobs
and work with a feeling of involvement and satisfaction. They
also find their work interesting.
Labour welfare measures raise labour productivity and bring
industrial peace and cordial labour-management relations.
 AGENCIES OF EMPLOYEES'
WELFARE
In India, the main agencies engaged in employees'
welfare include:
Central government Trade unions or employees'
The Central Government has passed several Acts for the
welfare of different types of workers. India has various laws
(Factories Act, etc.) ensuring basic workplace amenities
1 4 organisations
Trade unions, like the Textile Labour Association, aim
(canteens, restrooms) and healthcare for workers. The to improve worker welfare through education,
government also provides additional benefits like housing recreation, and legal aid. However, their impact is often
and education in some sectors. limited by lack of funds.

State governments Non-government

State governments enforce many labour laws,
including running health and education programs for
workers. They ensure employers follow these
regulations and can set additional rules for worker well-
being.
Employers
2 5 organisations (NGOs)
Several non-government or voluntary organisations
conduct social welfare activities that are useful to all
sections of society including industrial workers. These
agencies provide medical aid, educational facilities,
scholarships, etc. However, the contribution of such

3
organisations in labour welfare is not so significant.
Beyond mandatory benefits, many employers offer
extras like housing, healthcare, transportation,
recreation, and even educational support for workers'
children. These can be provided individually or through
industry groups.
 TYPES OF WELFARE SERVICES
Welfare services related to the physical and social
well-being of the employees both within and
outside the organization. The services within the
enterprise are known as intra-mural and those
outside the organization as extra-mural services.
Economic Services
Besides salary, companies offer benefits like pensions, life insurance, and
credit access. Pensions, based on final salary and years of service, provide
income after retirement. Some organizations offer family pensions and
contribute to life insurance. Additionally, some organizations help employees
set up credit unions and stores for discounted goods.
Employees need loans for things like bikes, TVs, and weddings. Companies
can offer advances to be paid back through salary deductions. They can also
encourage saving for future needs.

Welfare services may broadly be classified Recreational Services

into: mployees benefit from breaks in routine, so companies can offer recreational
activities like table tennis or team sports. This fosters a more positive
atmosphere and encourages cooperation among workers. Additionally,
reading rooms, libraries, radios, and TVs can be provided for their leisure time.

TA- Facilitative Services

ILI
C
FA E These are conveniences that the employees
TI-
REA TIV ordinarily require such as:

REC Canteen, restrooms and lunch room

A L Housing facilities

ON
Transportation facilities

MIC Medical facilities

ONO Washing facilities

EC Educational facilities
Consumers’ cooperative store
Leave travel concession
 LABOUR WELFARE OFFICER
The Factories Act (1948) requires factories with 500 or more employees to appoint a welfare
officer. This focus on worker well-being through designated personnel influenced later legislation.
The Plantation Labour Act (1951) and Mines Act (1952) also mandate welfare officers in plantations
with 300+ workers and mines with 500+ workers, respectively.
The welfare officer should possess
(i) a university degree,
(ii) degree or diploma in social service or social work or social welfare from a recognised
institution; and
(iii) adequate knowledge of the language spoken by most workers in the area where the factory is
situated.
The Committee on Labour Welfare has prescribed the following duties of a Labour Welfare Officer:
Supervision of (a) Safety, health and welfare programmes like Establishing liaison with workers so that they may: (a) Understand the
housing, sanitation, recreation, etc; (b) working of joint limitations under which they work; (6) appreciate the need of
committees, (c) grant of leave with wages; and (d) redressal of harmonious industrial relations in the plant, (c) interpret company
workers' grievances. policies correctly and (d) come to a settlement in case of dispute.
Counselling workers in (a) personal and family problems; (b) Establishing liaison with management so that they may appreciate
adjustment to their work environment; and (c) understanding workers' viewpoints on various matters in the plant.
their rights and privileges. Working with management and workers to improve productivity.
Advising management on matters of (a) formulating labour and Working with the outside public to secure proper enforcement of
welfare policies; (6) apprenticeship training programmes; (c) various laws.
meeting statutory obligations to workers; (d) developing fringe
benefits, and (e) workers' education and use of communication
media.
 Social security
“The securing of an income to take the place of earnings
when they are interrupted by unemployment, sickness or
accident, provide for retirement through old age, to provide
against loss of support by death of another person and to
meet exceptional expenditure connected with birth, death,
or marriage. The purpose of social security is to provide an
income up to a minimum and also medical treatment to
bring the interruption of earnings to an end as soon as
possible." - William Beveridge.
According to ILO, "Social security is the security that
society furnishes through
appropriate organization against certain risks to which its
members are exposed. These risks are essentially
contingencies against which the individual of small means
and meagre resources cannot effectively provide by his
own ability or foresight alone, or even in private
combination with his fellows. These risks being sickness,
maternity, invalidity, old age and death. It is characteristic
of these contingencies that they impair the ability of the
working man to support himself and his dependents in
health and decency.
SCOPE OF SOCIAL SECURITY

worker's family pension-cum

01 health insurance 04 insurance schemes

compulsory and voluntary social

02 maternity benefits 05 insurance

compensation for employment provident fund schemes, as also

03 injury 06 public health services; etc.
 Social Security programs have three
characteristics in common across countries, viz.,

they provide some form of cash

payment to individuals to
compensate at least a part of the the benefits or services are
they are established lost income that occurs due to provided in three ways: social
such contingencies as insurance, social assistance,
by law
unemployment, maternity, work or public service.
injury, invalidism, industrial
disease, old age, widowhood, and
orphan hood;
 the benefits or services are provided in three ways:
social insurance, social assistance, or public service

Social Assistance
Under it, the cost of the benefits provided is

Social Insurance
Under it, the workers and employers make
periodical contributions, with or without a
subsidy from the Government. The funds
so collected are used to provide benefits
based on the contribution record of the
beneficiary without testing his/her financial
position. For eg: Provident fund and group
insurance
financed fully by the Government without
any contributions from workers and
employers. However, benefits are paid after
judging the financial position of the
beneficiary. For eg: Old age pension.
Following components
of social security are
prescribed:
(a) Medical case. (b) Sickness benefit.
(c) Old age benefits or retirement benefits.
(d) Employment injury benefit. (e) Family
benefit. Maternity benefit. (g) Invalidity
benefit. (h) Survivor's benefit.
 TRENDS
Increased Use of Workforce Analytics: HR now uses
data to measure employee experience, just like
companies track customer experience. HR used to
focus on getting new hires, but now keeping them is
key. To fight high turnover, HR uses data and
surveys to understand employee needs and create
programs to keep them happy and engaged.
New Talent Strategies: Hiring slowed way down
during the pandemic, but now it's picking up again.
HR leaders are looking for tech-savvy people and
are using more temporary workers to save money.
Scaling Up Talent: The pandemic changed the skills
needed for many jobs. HR leaders are working with
managers to figure out what skills are missing and
how to train employees to get them. Employees are
also trying to learn new skills to avoid being laid off.
HR is helping by making training materials available
online, creating new training programs, and letting
employees learn from each other.
Increased Pressure to Maintain a Feeling of
Connection: When the pandemic began, not just
the business operations halted, the on-site
interactions too came to a halt abruptly. As the
organizations are re-opening with various work
models, there is pressure on the HR function to
make employees feel more connected and
enhance social engagement both in-person and
virtually (making and encouraging employees to
participate in events, fun activities, games, and
competitions).
Flexible work arrangements: More and more
companies are offering flexible work arrangements,
such as remote work, flextime, and compressed
workweeks. This allows employees to have more
control over their work-life balance and
productivity.
CHALLENGES
Adapting to Technological Advances: As technology continues to evolve,
HR faces the challenge of integrating emerging tools and platforms into
welfare and social security management. This includes leveraging AI for
personalized benefits recommendations, implementing blockchain for
secure data management, or utilizing mobile apps for easy access to
benefit information.
Public Health Emergencies: Events like pandemics or natural disasters
can significantly impact employee welfare and social security. HR must
have contingency plans in place to address the immediate health and
safety needs of employees while also ensuring continuity of benefits and
support during crises.
Demographic Shifts: With an ageing workforce and a younger generation
entering the workforce, HR must balance the needs of different age groups
in designing welfare and social security programs. This includes
considerations such as retirement planning, healthcare coverage, and
work-life balance initiatives.
Changing Workforce Dynamics: The rise of remote work, gig economy
jobs, and non-traditional employment arrangements complicates the
administration of benefits and social security. HR must adapt policies and
systems to accommodate diverse employment models while ensuring
equitable access to welfare programs.
Community and Stakeholder Engagement: Collaborating with external
stakeholders, such as government agencies, community organizations, or
advocacy groups, can enhance the effectiveness of welfare and social
security initiatives. HR must actively engage with these stakeholders to
leverage resources, share best practices, and advocate for supportive
policies.
 CASE STUDY
GREEN GARMENTS - BALANCING EMPLOYEE NEEDS WITH SOCIAL SECURITY OBLIGATION.
Company: Green Garments, a clothing manufacturer in a developing country with 500
employees.
CHALLENGE:
Green Garments faces pressure to keep production costs low while
complying with social security regulations. Many employees are
unaware of their social security benefits, leading to financial
insecurity in retirement or during emergencies. Additionally, long
working hours and unsafe working conditions contribute to low
morale and potential health problems.

SOLUTION:
Green Garments takes a two-pronged approach:
Enhancing Employee Welfare:
Implement fair wages that meet minimum wage requirements.
Improve working conditions through better ventilation, lighting, and safety protocols.
Offer on-site childcare facilities for working parents.
Organize financial literacy workshops to educate employees about social security
benefits and responsible money management.
Optimizing Social Security Compliance:
Work closely with government agencies to ensure proper social security
contributions for all employees.
Develop a transparent system where employees can access information about
their social security contributions and benefits.
Partner with social security providers to offer additional health insurance or
retirement savings plans.
 CASE STUDY
RESULTS:
Improved Employee Morale: Employee morale and sense of security increase with better
working conditions and financial literacy education.
Reduced Absenteeism: A healthier and more secure workforce leads to lower
absenteeism rates.
Enhanced Brand Reputation: Green Garments gains recognition for ethical labour
practices, attracting responsible consumers and investors.
Increased Productivity: A motivated and well-cared-for workforce translates to higher
productivity.

CHALLENGES AND CONSIDERATIONS:

Balancing the affordability of employee benefits with maintaining competitive
production costs can be difficult.
Educating a diverse workforce with varying literacy levels about social security may
require creative and targeted approaches.
Navigating complex social security regulations in developing countries can require
collaboration with government agencies and legal experts.

LESSONS LEARNED:
Investing in employee welfare and social security creates a more stable and
productive workforce.
Collaboration with government and social security providers is crucial for effective
program implementation.
Financial literacy education empowers employees to take control of their financial
future.
 CASE STUDY
CONCLUSION:
Green Garments' case illustrates how a company can navigate the
challenges of employee welfare and social security in a developing country.
By prioritising both employee needs and compliance with social security
regulations, Green Garments creates a sustainable and responsible
business model that benefits both the company and its workforce.

QUESTIOSNS
1. Why prioritize employee safety and well-being in today's corporate
landscape, and how can companies ensure thorough protection and
support?
Ans.: Prioritizing employee safety and well-being is paramount in
today's corporate landscape, ensuring thorough protection and
support entails implementing rigorous safety protocols, offering
comprehensive training, providing access to necessary resources,
and fostering a culture of accountability and transparency within
the organization.
 QUESTIONS
2. How do personalized benefits packages enhance satisfaction,
loyalty, and retention, and how can companies tailor them
effectively?
Ans.: Personalized benefits packages play a crucial role in
enhancing satisfaction, loyalty, and retention among employees
by addressing their unique needs and preferences. Effective 4. How do employee assistance programs address
tailoring involves conducting thorough assessments, offering a diverse needs, fostering holistic well-being within the
diverse range of benefits, providing clear communication, and workplace?
regularly soliciting feedback to ensure alignment with employee Ans.: Employee assistance programs address a wide
expectations. range of needs, including mental health support,
3. What impact does promoting work-life balance have on financial counselling, career development resources,
corporate culture, and how can companies implement effective and almost above all work-life balance initiatives By
policies? How does ABC measure and improve work-life balance offering comprehensive support services, these
initiatives? programs contribute to fostering a culture of well-
Ans.: Promoting work-life balance significantly influences being and resilience within the workplace, ultimately
corporate culture by fostering a positive and productive work enhancing employee satisfaction and productivity.
environment. Effective policies may include offering flexible
scheduling options, encouraging remote work opportunities,
providing access to wellness programs, and promoting a culture
of mindfulness and stress management. These steps should be
taken by the ABC, coupled with a sense of understanding and
Taylor's principles of harmony, not discord, Cooperation not
individualism are evergreen in this industry as well.
 MULTIPLE CHOICE QUESTIONS

1. The employee welfare facilities available inside the organisation

are called
✅
a) intra- mural facilities
b) extra-mural facilities
c) extravagance
4. In the absence of statutory requirements, the
d) none of the above
employees may not provide even the basic facilities to
the Employees this is the basic assumption of the
2. The employee welfare facilities available outside the organisation
a) religious theory
are called
a) intra- mural facilities
✅
b) policing theory

✅
b) extra-mural facilities
c) appeasement theory
d) benevolence theory
c) extravagance
d) none of the above
5. According to which theory, employee welfare is an
investment that would multiply and return to the
3. Who among the following has the responsibility for employee
employees in some other forms?
welfare?
a) Employers
✅
a) religious theory

b) central government ✅ b) policing theory

c) appeasement theory
c) state government
d) benevolence theory
d) all of the above
 TRUE & FALSE

1. One of the reasons for giving to employees for

retirement planning and other benefit decisions is
to increase their understanding of such benefits
(T)
2. Insurance risks can be more easily pooled in
smaller groups. (F)
3. Social Security retirement benefits are no longer
subject to an earnings test once retirement age is
reached. (T)
4. The unemployment insurance program is
financed through federal and state taxes for
employees and employers. (F)
5. Unemployment benefits are typically about 50 %
of an eligible individual's previous earnings and
last for 52 weeks. (F)
Book references

Essentials of Human Resource Management By TN Chhabra & Monica S. Chhabra

Human Resource Management By VSP Rao
Human Resource Management By CP Gupta
Thank You
Prepared By
Rakshit: 10261
Raviraj Kaita: 10262
Ayan Sarkar: 10263
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Pragati Sharma: 10265
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