HUMAN RESOURCES THE CONCEPT OF LABOUR WELFARE
“Labour welfare is a comprehensive term including various
services, benefits and facilities offered to Labors & by the
employers. Through such generous fringe benefits the
employer makes life worth living for Labors.”
Welfare includes anything that is done for the comfort and
improvement of Labors and is provided over and above the
wages. Welfare helps in keeping the morale and motivation
of the Labors high so as to retain the Labours for longer
duration. The welfare measures need not be in monetary
terms only but in any kind/forms. Labour welfare includes
monitoring of working conditions, creation of industrial
harmony through infrastructure for health, industrial
relations and insurance against disease, accident and
unemployment for the workers and their families.
Labour welfare entails all those activities of employer which
are directed towards providing the Labours with certain
facilities and services in addition to wages or salaries.
The very logic behind providing welfare schemes is to
create efficient, healthy, loyal and satisfied labor force for
the organization. The purpose of providing such facilities is
to make their work life better and also to raise their
standard of living. The important benefits of welfare
measures can be summarized as follows:
• They provide better physical and mental health to workers
and thus promote a healthy work environment
• Facilities like housing schemes, medical benefits, and
education and recreation facilities for workers’ families help
in raising their standards of living. This makes workers to
pay more attention towards work and thus increases their
productivity.
• Employers get stable labor force by providing welfare
facilities. Workers take active interest in their jobs and work
with a feeling of involvement and participation.
• Labour welfare measures increase the productivity of
organization and promote healthy industrial relations
thereby maintaining industrial peace.
• The social evils prevalent among the labors such as
substance abuse, etc are reduced to a greater extent by the
welfare policies.
Benefits:
Welfare includes anything that is done for the comfort and
improvement of Labours and is provided over and above
the wages. Welfare helps in keeping the morale and
motivation of the Labours high so as to retain the Labours
for longer duration. The welfare measures need not be in
monetary terms only but in any kind/forms. Labour welfare
includes monitoring of working conditions, creation of
industrial harmony through infrastructure for health,
industrial relations and insurance against disease, accident
and unemployment for the workers and their families.
Labor welfare entails all those activities of employer which
are directed towards providing the Labours with certain
facilities and services in addition to wages or salaries.
Labor welfare has the following objectives:
• To provide better life and health to the workers
• To make the workers happy and satisfied
A DOCUMENT BY SADANANDA
• To relieve workers from industrial fatigue and to
improve intellectual, cultural and material conditions of
living of the workers.
The basic features of labor welfare measures are as follows:
• Labor welfare includes various facilities, services and
amenities provided to workers for improving their
health, efficiency, economic betterment and social
status.
• Welfare measures are in addition to regular wages and
other economic benefits available to workers due to
legal provisions and collective bargaining.
• Labor welfare schemes are flexible and ever-changing.
New welfare measures are added to the existing ones
from time to time.
Welfare measures may be introduced by the employers,
government, Labours or by any social or charitable agency.
The purpose of labor welfare is to bring about the
development of the whole personality of the workers to
make a better workforce.
The very logic behind providing welfare schemes is to
create efficient, healthy, loyal and satisfied labor force for
the organization. The purpose of providing such facilities is
to make their work life better and also to raise their
standard of living. The important benefits of welfare
measures can be summarized as follows:
They provide better physical and mental health to workers
and thus promote a healthy work environment
Facilities like housing schemes, medical benefits, and
education and recreation facilities for workers’ families help
in raising their standards of living. This makes workers to
pay more attention towards work and thus increases their
productivity.
Employers get stable labor force by providing welfare
facilities. Workers take active interest in their jobs and work
with a feeling of involvement and participation.
Labour welfare measures increase the productivity of
organization and promote healthy industrial relations
thereby maintaining industrial peace.
The social evils prevalent among the labors such as
substance abuse, etc are reduced to a greater extent by the
welfare policies.
For example at Bajaj Electricals there are many welfare
activities like long service and retirement awards on 14th
July every year for Labours, to be categorized into 15 years
long service and 25 long service.
There is also welfare trust which formed by Bajaj Electricals
for providing loan to Labours for housing needs and also for
the reimbursement of medical expenses. They have created
“social responsibility of business fund” to provide
scholarship to employees and children for higher education
and also there is emergency assistance in the form of
financial assistance to the family in case of death of any
Labour in harness.
Welfare Fund:
Labor welfare refers to all the facilities provided to labor in
order to improve their working conditions, provide social
security and raise their standard of living. Majority of labor
PAGE NO. 1
HUMAN RESOURCES THE CONCEPT OF LABOUR WELFARE
force in India is working in unorganized sector. In order to
provide social security to such workers, Government has
introduced Labor Welfare Fund to ensure assistance to
unorganized labors. Five different welfare funds, which are
governed by different legislations, are administered by
Ministry of Labor. The purpose of these welfare funds is to
provide housing, medical care, educational and recreational
facilities to workers employed in beedi industry and non-
coal mines and cine workers.
The five legislations governing welfare funds are as follows:
1. Labour Welfare Fund Act Rules in Factories Act, 1948
2. The Mica Mines Labor Welfare Fund Act, 1946
3. The Limestone and Dolomite Mines Labor Welfare Fund
Act, 1972
4. The Iron Ore, Manganese Ore and Chrome Ore Mines
Labor Welfare Fund Act, 1976
5. The Cine Workers’ Welfare Fund Act, 1981
Schemes under welfare funds provide assistance with
respective to the following:
• Public health and sanitation
• Housing
• Recreational (including standard of living)
• Social security
• Educational facilities
• Water supply
• Transportation
• Medical facilities (prevention of diseases)
• Social security
• Group Insurance Schemes for Beedi and Cine workers
• Social Security under Mine Workers Welfare Fund
• Family welfare
The welfare funds are raised by government by imposing
cess on manufactured beedis, feature films, export of mica,
consumption of limestone & dolomite and consumption and
export of iron ore, manganese ore & chrome ore. An
explanation of the cess levied under different legislations is
given below:
• Beedi Workers Welfare Cess Act, 1976 provides for levy
of cess by way of excise duty on manufactured beedis
from Re.1/- to Rs.5/- per thousand manufactured
beedis. This is presently Rs 2 per 1000 beedis with
effect from 28th June 2000.
• The Cine Workers Welfare Cess Act, 1981 provides for
duty of cess, at such rate not being less than one
thousand rupees and not exceeding twenty thousand
rupees, on every feature film submitted to the
Chairman, Central Board of Film Certification. This is Rs
20000 per feature film of Hindi and English and for
regional films it is Rs 10000 per film with effect from
20th April 2000.
• The Iron Ore, Manganese Ore & Chrome Ore Mines
Labor Welfare Cess Act, 1976 provides for levy and
collection of cess on Iron Ore, Manganese Ore &
Chrome Ore between 50p to Re.1/-, Re.1/- to Rs.6/-
and Rs.3/- to Rs.6/- respectively.
• The Limestone and Mines Labor Welfare Fund Act, 1972
provides for the levy and collection of cess on
A DOCUMENT BY SADANANDA
Limestone and Dolomite as a duty of excise at such rate
not exceeding one rupee per metric tonne of limestone
& dolomite. The rate of cess on Limestone and Dolomite
is Re.1/- with effect from 27th December 2000.
• Mica Mines Labor Welfare Fund Act, 1946, provides for
levy and collection of cess on all mica exported as duty
of Customs not exceeding 6.25% ad valorem. This is
4.5% ad valorem on export with effect from 1st
November 1990.
Welfare Schemes:
Organizations provide welfare facilities to their Labours to
keep their motivation levels high. The Labour welfare
schemes can be classified into two categories viz. statutory
and non-statutory welfare schemes. The statutory schemes
are those schemes that are compulsory to provide by an
organization as compliance to the laws governing Labour
health and safety. These include provisions provided in
industrial acts like Factories Act 1948, Dock Workers Act
(safety, health and welfare) 1986, Mines Act 1962. The non
statutory schemes differ from organization to organization
and from industry to industry.
STATUTORY WELFARE SCHEMES
The statutory welfare schemes include the following
provisions:
• Drinking Water: At all the working places safe hygienic
drinking water should be provided.
• Facilities for sitting: In every organization, especially
factories, suitable seating arrangements are to be
provided.
• First aid appliances: First aid appliances are to be
provided and should be readily assessable so that in
case of any minor accident initial medication can be
provided to the needed Labour.
• Latrines and Urinals: A sufficient number of latrines and
urinals are to be provided in the office and factory
premises and are also to be maintained in a neat and
clean condition.
• Canteen facilities: Cafeteria or canteens are to be
provided by the employer so as to provide hygienic and
nutritious food to the Labours.
• Spittoons: In every work place, such as ware houses,
store places, in the dock area and office premises
spittoons are to be provided in convenient places and
some are to be maintained in a hygienic condition.
• Lighting: Proper and sufficient lights are to be provided
for Labours so that they can work safely during the
night shifts.
• Washing places: Adequate washing places such as
bathrooms, wash basins with tap and tap on the stand
pipe are provided in the port area in the vicinity of the
work places.
• Changing rooms: Adequate changing rooms are to be
provided for workers to change their cloth in the factory
area and office premises. Adequate lockers are also
provided to the workers to keep their clothes and
belongings.
PAGE NO. 2
HUMAN RESOURCES THE CONCEPT OF LABOUR WELFARE
• Rest rooms: Adequate numbers of restrooms are
provided to the workers with provisions of water supply,
wash basins, toilets, bathrooms, etc.
NON STATUTORY SCHEMES
Many non statutory welfare schemes may include the
following schemes:
• Personal Health Care (Regular medical check-ups):
Some of the companies provide the facility for extensive
health check-up
• Flexi-time: The main objective of the flextime policy is
to provide opportunity to Labours to work with flexible
working schedules. Flexible work schedules are initiated
by Labours and approved by management to meet
business commitments while supporting Labour
personal life needs
• Labour Assistance Programs: Various assistant
programs are arranged like external counseling service
so that Labours or members of their immediate family
can get counseling on various matters.
• Harassment Policy: To protect an Labour from
harassments of any kind, guidelines are provided for
proper action and also for protecting the aggrieved
Labour.
• Maternity & Adoption Leave – Labours can avail
maternity or adoption leaves. Paternity leave policies
have also been introduced by various companies.
• Medi-claim Insurance Scheme: This insurance scheme
provides adequate insurance coverage of Labours for
expenses related to hospitalization due to illness,
disease or injury or pregnancy.
• Labour Referral Scheme: In several companies Labour
referral scheme is implemented to encourage Labours
to refer friends and relatives for employment in the
organization.
Labour Welfare Actvities:
Before going for any Welfare activities, you must check
whether it comes under company expenses for the same
and it should not be overburdened.
Some of the welfare activities you may organize is below-
• Birthday Celebration with cake cutting- You may
celebrate B'day Party at last weekend of all whose B'day
was there in that month. Arrange a big cake according
to strength of your Labours.
• Labour of Month- During this B'day celebration, even
you may celebrate the Labour of The Month Award also.
It will be awarded on the basis of performance of that
individual in that particular month.
• Arrange some Training programs, related with their
personality developments, sales skill development,
Communication classes.
• Celebrate Friendship Day...
Moreover if your Labours are not covered under any Health
Schemes, then you may ask them to enroll them with some
Medical facilities, being provided by so many Insurance
Companies. It is available at a very low premium. So
company may also help to an extent.
Indian workmen view welfare as below:-
A DOCUMENT BY SADANANDA
• *Subsidized canteen facilities
• *Entertainment (including sports & games)
• *Medical facilities for the self and family (now-a-days
group insurance plays a vital role instead of Medical
facilities at the factory premises itself)
• *Educational aids to the wards of the workmen
• *Transportation facilities (not necessarily company bus
facility - even TA will do)
• *Interest-free loan facilities or low interest loans
• *Freebies during festivals and/or Founder's Day etc.
Besides the normal Health & Safety, Staff Events,
Professional Development programs etc., the following can
be included in the Welfare Plan or Policy.
• Vacation
• Child Care
• Holidays
• Workers' Compensation Insurance
• Sick or Personal Leave
• Voting
• Jury Duty
• Military Service
• Bereavement Leave
• Relocation of Current or New Employees
• Temporary Assignment Allowance
• Professional Memberships
• Health Insurance
• Health Benefits Continuation (COBRA)
• Short-term Disability Insurance
• Long-term Disability Insurance
• Life Insurance
• Employee Assistance Program
• Flexible Spending Account
• Employee-Incurred Expenses and Reimbursement
• Mileage Reimbursement
• Travel Reimbursement
• Required Management Approval
• Educational Assistance
• Parking
• Kitchen — Break Room
• Employee Recognition
• Matching Gifts Plan
Of course, there are quite a lot you can be done. It all
depends on priorities/constraints/Policies and the budget for
the same.
Some of the following:
1. A crèche facility for working mothers.
2. Work from home for expecting mothers
3. Flexi timing for applicable staff
4. Arranging lectures from eminent doctors on certain
common occupational hazards and preventing the
same. For eg if someone is constantly on the phone
(e.g. front office people) they tend to develop certain
ailments. You can arrange how to prevent the same.
Same is true for people using computers constantly
(like you and me). Prevention of RSI etc.
5. Conducting yoga/aerobic classes within the campus (if
space available) or tie up with a local health club.
PAGE NO. 3
HUMAN RESOURCES THE CONCEPT OF LABOUR WELFARE
6. Sponsoring for Gymnasium memberships or alternately
having an in-house GYM.
7. Encouraging employees to be part of some sporting
teams (Your Company’s team) like Cricket or volleyball
or football and allowing them to participate in
intercompany competitions. This will also build branding
for your company.
8. Conducting quarterly/annually get together of the
respective divisions or the whole company along with
their family members to bond the family with the
organization.
9. Sponsoring team outings/lunches for celebrating
important milestones to build team spirit.
10. Giving a Gift vouchers/Sponsoring dinners on important
personal occasions/celebrations like birthdays, wedding
anniversary, birth of a new child into the family etc.
11. Granting paternity leaves (Most of them have 5 days)
for employees (Some companies don't have) when a
child is born.
12. Facilitating a Concierge services for routine chores like
credit card payments, bill payments, railway/flight
ticket bookings, bus ticket bookings, tax payments,
insurance payments, mobile bill payments, movie ticket
bookings, Gas bookings, etc for busy busy people. You
don't have to pay the charges but you can set up a desk
at your office. Let the employee pay the service charges
to them most companies do these work for a small fee
say 5 Rs per transaction. Etc.
Basically by facilitating this you are taking the pains away
from the employee and allow him focus on his job.
13. If your staff is staying in far off places may be you can
provide a company transport (by deducting applicable
charges) on a no profit no loss basis. I feel driving is
pain in most cities.
14. Since you are a FMCG company, you can give your
employees some kind of rebate/discount on items
purchased on your own products.
For senior management, you could consider providing
housing loan subsidy (Part of the interest is paid by
company).
15. In addition to PF and gratuity, for senior people, you
could provide superannuation contributions (LIC has a
scheme) for retaining top executives.
The Good One: Employee of the Month:
For motivating the employees by recognizing, appreciating
& rewarding them for their good performance, the concept
of "Employee of the Month" was introduced from September
2006.
Parameters for Selections of Employee of the Month are
given below:
1. Attendance, regularity & punctuality.
2. Knowledge of the work, methods & processes.
3. Promptness in timely completion of work.
4. Ability to take initiative/ Proactive.
5. Ability to do hard work and excel in profession.
6. Creative & innovative.
7. Sincerity & Commitment (Sense of Responsibility).
A DOCUMENT BY SADANANDA
8. Participation & involvement.
9. Relations with peer group (Team Spirit).
10. Overall Attitude & Behavior.
Employee Welfare Measures:-
The disbursed scopes, items and ratios of employees'
welfare fund
The disbursed scopes, items and ratios of the
employees' welfare fund are given in accordance with
Paragraph 1, Article 7 of Employees' Welfare Fund Act as
follows:
The disbursed scopes and items:
• Welfare benefits: Wedding, funeral, bearing benefits for
injury and disease, emergency aid and loan, disaster
assistance etc.
• Educational grants: Subsidies for employees' advanced
study and educational fees for their children etc.
• Recreation activities: Culture and health activities,
group activities, tourism and recreation facilities etc.
• Other welfare items: Festival grants, interests subsidy
for the housing loan, employees' deposit insurance,
purchasing house with employee deposit, child-care and
spouse dependants subsidies, retired employees'
benefits and other benefits etc.
The disbursed ratios of employees' welfare fund:
All above kinds of disbursed ratios shall not be limited,
except the total amount of all kinds of disbursed ratios shall
not exceed 100% of the amount of the employees' welfare
income of current year. The employees' welfare fund shall
be issued to the employees by cash, based on the principle
of directness and universality. In addition, the issued fund
shall not exceed 40% of the amount of the employee
welfare income of the current year.
Employees' welfare fund capital
All factories, mines in the public and private sectors, or
other enterprise organizations shall set-aside and allocate
the first employees' welfare fund, which shall be allocated
one time enough in accordance with the amount of paid-in
capital, not allocated by years. The amount of first paid-in
capital shall not be less than 1/4 of the total registered
capital as ruled by the Company Act in case of
reestablishment.
The disbursed scopes, items and ratios of cumulative
employees' welfare fund
In accordance with the Paragraph 1, Article 7 of Employees’
Welfare Funds Act, the disbursed scopes, items and ratios
of cumulative employees' welfare fund are given as follows.
If the cumulative employees' welfare fund in past years is
within 50%, the securities shall be purchased.
The purchase of disbursed securities and dispositions shall
be conducted in accordance with the following regulations:
PAGE NO. 4
HUMAN RESOURCES THE CONCEPT OF LABOUR WELFARE
The employees' welfare committee of institutions shall • Welfare facilities

obtain the agreement of half of presented commissioners; Article 3 The Committee of factories, mines, and other
in which 2/3 of all commissioners shall attend while business entities shall appoint from seven to a maximum of
purchase the securities. And the disbursement shall be dealt twenty-one members. The Committee of business entities
with the same way. having one thousand or more employees may appoint up to
The purchase of securities of cumulative employee welfare a maximum of thirty-one members.
fund is limited: Article 4 The Committee may appoint one of the committee
• Government bond. members as the ex officio member. All other members are
• Treasury. determined as described below:
• Transferable fixed deposit. • The method used to elect committee members shall be
• Bank acceptance. determined by the business entity and the union
• Commercial issued paper issued by a bank or financial separately. The elected committee members of union
institution. should elect at least two-thirds of the committee
• Financial bond issued by a financial institution. members.
The preceding Paragraph of issued securities’ companies in • For business entities without a union, the committee
items 4-6 of Subsection 2 must be ranked in the certain members are determined by the business entity and the
welfare committee. In this case, the method used to
credited level that recognized by the Department of
select members is determined by the business entity.
Finance. Labor representatives are elected by all employees.
Limits of any interested persons who purchased the
Substitute members should be also be elected at the same
securities of cumulative employee welfare fund:
time. The number of substitute members shall not exceed
The employees' welfare fund shall not purchase the issued
one-third of all members.
securities by the business entities or the relevant interested
Article 5 Two or more business entities may jointly form one
companies.
committee for the convenience, with members elected
The called interested companies refer to one of following
according to the previous two articles.
circumstances:
Article 6 The Committee has one chairperson in charge of
• Business entities with the relation specified in Section 1,
Chapter 6 of the Company Act. committee affairs. A deputy chairperson may be appointed.
• The company of the interested company is that the Both are elected by members.
director, supervisor or others who hold more than 50% Committee memberships are positions without pay, with
stocks of this business entity. terms ranging from one to three years. The term begins
• The company of the interested company is that the
from the day they assume office. This day shall not be
director, supervisor or managerial officers and directors,
supervisors, managerial officers of other company or beyond the fourteenth day from the day of the last term
shareholder who hold more than 10% issued stock of expired.
this business entity is the same person, or with the No more than two-thirds of members shall rerun and be
spouse relationship. The director or supervisor is the reelected. The ex officio member’s term is not limited.
legal person, his/her representative or assigned
Article 7 After new chairperson takes over, the Committee
representative exercises the duty that shall be followed
the regulations of the original directors or supervisor. shall complete transferring documents regarding the Fund
and other assets within ten days following the change of
Rules Governing Organization of Employees’ Welfare
chairperson.
Committee
For failure to complete the transfer within ten days for
Article 1 The Rules have been prescribed pursuant to Article
legitimate reasons, the new chairperson shall submit a
5 of Employees’ Welfare Fund Act.
report to competent authorities with reasons included.
Article 2 The Rules shall include the following:
• Name of the Committee Article 8 In case the chairperson cannot perform duties for
• Address of the Committee some reason, the deputy (chairperson) shall take over. A
• Organization of the Committee and handling of affairs chairperson shall be elected if there is no deputy.
• Number of members and term of Committee
When the number of members falls below half of required
• Appointment, dismissal and recall of, and resignation by
number, the original Committee shall be notified to elect
members
• Norms of meetings new members to make up for the difference.
• Safekeeping and withdrawal of the Fund

A DOCUMENT BY SADANANDA PAGE NO. 5

HUMAN RESOURCES THE CONCEPT OF LABOUR WELFARE
Article 9 The Committee shall hold election of members • Daycare or kindergarten
• Laundry
thirty days before existing members’ ers’ term expires.
• Library
Competent authorities shall notify committees having not • Recreation
held such election fifteen days before expiry to hold the • Supply of articles of daily use
election within fifteen days. For committees that fail to • Other services regarding employee welfare
comply, competent authorities may designate personnel to Recipients of above services are limited to the business
hold such election. entity’s employees and their dependants. The Cooperative
Article 10 The Committee meets every three months. When shall be self-sufficient
sufficient without siphoning monies from the
necessary, an ad hoc meeting shall be called. Fund for its operation.
Member meetings are called by the chairperson. Article 17 The Committee may have one chief executive
Chairperson shall call an ad hoc meeting within seven days instated to assist the chairperson in running daily business.
following written appeal by one third
rd of members. Several staff members under the chief executive are
For chairperson failing to call a periodic or ad hoc meeting grouped to help run Committee business.
for no legitimate reasons, a report may be filed with The Cooperative is headed by one person, in charge of the
competent authorities after being approved by one third of Cooperative, with several staff members under him/her.
members. Competent authorities may designate one of the Chairperson of the Committee shall request the business
members to call the meeting. entity to which it belongs to elect employees for above
Article 11 The Committee shall submit the following positions, working part-time.
time. Business entities having five
information to competent authorities for review: hundred
dred or more employees may have one to five
• Rules and regulations
employees taking up these positions full-time
full
• Rosters of members and staff
Article 18 For unions organized by workers who have no
• Address of the Committee
• Date on which the Committee was established definite employers, their welfare committee members shall
be elected according to the rules drawn up by the union,
uni to
In the
e event of change(s) to the first three items above, a
be carried out in accordance with the Rules.
report shall be presented to competent authorities.
Article 19 The Rules take effect from the day they are
Article 12 Responsibilities of the Committee are as follow:
• Review, promotion, and supervision of employees’ published.
welfare undertakings
• Planning, custody, and withdrawal of the Fund
• Distribution, audit, and revenues and expenditures of
the funds of employee welfare undertakings
• Other issues related to employee welfare
Article 13 The Committee shall draw up plans and prepare
budgets for the next year within
n one month before end of
the year, to be passed by member meeting resolutions and
submitted to competent authorities for review. Within three
months following end of year, the Committee shall submit a
report on execution of plans and budgets to competent
authorities for review, with a copy sent to the business
entity to which it belongs.
Article 14 The Committee may set up an employee welfare
cooperative.
Article 15 Prior to setting up employee welfare cooperative,
relevant information shall be submitted to competent
authorities for registration and supervision.
Article 16 The Cooperative shall provide the following
services based on employee needs and funding:
• Canteen
• Dormitory or housing
• Haircut
A DOCUMENT BY SADANANDA PAGE NO. 6