Welfare of Employees and Steel Organization


Welfare of Employees and Steel Organization

Employees are essential for the production in a steel organization. They deserve to be treated with respect and to be provided with proper welfare facilities and incentives. Employees’ welfare refers to those measures of the organization which aim at promoting the physical, psychological, and general wellbeing of the employees. The basic aim of welfare measures is to improve the living and working conditions of the employees along with their families. Normally employees’ families are included when welfare measures are taken by the organization since the employees’ wellbeing cannot be achieved in isolation from their family. The employees’ welfare measures include some or all of the amenities provided in or near the organization and related to the working and living conditions.

The employees’ welfare measures have the following objectives (Fig 1).

  • To provide better life and health to the employees
  • To make the employees happy and satisfied
  • To relieve the employees from work fatigue
  • To improve the intellectual, cultural and material conditions of the employees

Objectives of the employees welfare measures

Fig 1 Objectives of the employees’ welfare measures

Welfare measures improve employees’ worth and boost their self-esteem, morale, financial status and act as, a sort of motivation to drive the employees to have more passion for their job and thus increase their productivity. Welfare measures are what the steel organization management is expected to pursue as it look beyond instant profit making for enduring sustainable performance of the organization in perpetuity. Lack or inadequate welfare facilities and other incentives lead to poor motivation of the employees. This greatly affects their performance as well as the performance of the organization. Hence, there is need for the management to provide the employees’ welfare facilities and other incentives in the organization so that the employees, management, and the steel organization can benefit.

Employee’s welfare is defined as the efforts made by the management to make life worth living for the employees. Employee welfare is a comprehensive term which includes various services, benefits and facilities offered to employees by the management. By providing these fringe benefits generously, the management makes the life worth living for the employees and earns their loyalty.

The International Labour Organization (ILO) has defined ‘labour welfare as a term which is understood to include such services, facilities and amenities as may be established in or in the vicinity of undertakings to enable the persons employed in them to perform their work in healthy, congenial surroundings and to provide them with amenities conducive to good health and high morale’.

Employees’ welfare includes all those things which are done for the improvement of the living environment of the employees and their families and they are provided over and above the wages. The welfare measures need not be in monetary terms only but it can be in in form of kind and facilities. These include making the work place of the employees safe and comfortable to work and creating an environment of harmony through development of infrastructure facilities such as housing, markets, medical and health care, education and training, retirement and old age benefits, facilities for cultural and religious functions, means for sports and recreation, means of transport, and canteens at work place etc. Besides this, monetary facilities like bonus, insurance and pension plans, festival advances, and  loans for meeting the various needs of employees such as housing, automobile purchase, and celebration of various family functions etc. comes under employees’ welfare measures. The following are the main features of the employees’ welfare.

  • Employees’ welfare is a comprehensive term including various services, facilities and amenities provided by the management to employees for their betterment.
  • Welfare measures are in addition to regular salaries and wages and other economic benefits available to employees under legal provisions and collective bargaining.
  • The basic purpose of employee welfare is to improve the lot of the working people and thereby make an employee efficient and a happy citizen.
  • Employees’ welfare is an essential part of the social welfare measures taken by the organization. It involves adjustment of the employee’s work life and family life to the community or social life.
  • Welfare measures may be both voluntary and statutory.

Employees’ welfare measures help in keeping the morale and motivation of the employees high and hence help the organization in retaining the employees for longer duration. The very logic behind providing welfare facilities by the management is to create efficient, healthy, loyal and satisfied employees for the organization by making their work life better and also by raising their standard of living.

Basic features of employees’ welfare facilities

The basic features of employees’ welfare facilities are as given below.

  • Employees’ welfare facilities which include various facilities, services and amenities provided to the employees, improve their efficiency, economic betterment and social status. The efficient employees help the organization in improving the productivity and achieving its objectives.
  • Welfare measures are in addition to regular wages and other economic benefits available to the employees due to statutory provisions and collective bargaining and hence they help the employees in improving their financial status.
  • Employees’ welfare measures may be introduced by the management, statutory authorities, employees on co-operative basis, or by any social or charitable agency.
  • These facilities are dynamic in nature and are flexible. They vary from place to place and organization to organization and time to time as per requirements. New welfare measures are added to the existing ones from time to time.
  • These facilities improve physical and mental health of the employees and promote healthy work environment at the work place.
  • These facilities help in raising the standard of living of the employees and their families so that employees can pay more attention towards work and increase their own productivity.
  • These facilities bring about the development of whole personality of the employees thus prepares a better workforce for the organization.
  • These facilities reduce employees’ dissatisfaction and develop employees’ loyalty towards the organization.
  • These facilities relieve employees from work fatigue and improve their performing capabilities besides increasing their intellectual and cultural strengths.

Classification of the employees’ welfare measures

Employees’ welfare schemes can be classified into the following two categories.

  • Intramural facilities – These are provided within the plant or working place and include such facilities as rest rooms, creches, drinking water, canteens and subsidized food, uniforms, safety equipments and protective clothing, proper lighting at work place, first aid facilities, recreation facilities, greenery and parks, and toilet blocks and washrooms etc. The organization is to provide many of these intramural facilities in order to comply with the statutory regulations on health and safety of the employees.
  • Extramural facilities – These are activities which are undertaken outside the plant or work place. The extramural facilities differ from organization to organization and from industry to industry. The basic purpose of employees’ welfare is to enrich the quality of life of employees and keep them happy and contended. Extramural activities are provided by the management so that the employees can feel that they are cared for, are well informed, and are involved in the organizational activities. These activities help in the alignment of the thinking of the management and employees towards the organizational objectives through the cultural means. The extramural activities among others include housing, educational facilities, maternity benefits, medical and health care, transportation, sport and recreational facilities, leave travel, vocational training, holiday homes, co-operative stores, fair price shops, and social insurance etc.

The efforts towards employees’ welfare measures have their origin either in some statute formed by the state or in some local custom or in collective agreement or due to the initiative take by the management. Employees’ welfare measures are taken due to the following.

  • To give expression to philanthropic and paternalistic feelings
  • To win over employee’s loyalty and increase their morale
  • To unite the employees into a progressive force through cultural means
  • To build up stable employees team, to reduce employees’ turnover and absenteeism
  • To develop efficiency and productivity among the employees
  • To utilize organizational surplus in developing the employees
  • To earn goodwill and enhance corporate image
  • To make the organizational working more effective
  • To make recruitment of new employees more effective since benefits of welfare measures add to the job appeal.

Benefits of employees’ welfare measures

The important benefits of the employees’ welfare measures can be summarized as follows.

  • These measures provide better physical and mental health to the employees and thus promote a healthy work environment.
  • Facilities like housing, medical and health care, and facilities for education and recreation for the families of the employees help in raising their standards of living. This helps the employees to pay more attention towards work and as a result there is an increase in their productivity.
  • Organizational management get stable team of employees by providing welfare facilities. Employees take active interest in their jobs and work with a feeling of involvement and participation.
  • Employees’ welfare measures increase the productivity of the organization and promote healthy industrial relations thereby maintaining industrial peace.
  • The social evils prevalent among the employees get reduced to a greater extent by the welfare measures since the leisure time of the employees is used in a positive way.

Principles of employees’ welfare activities

The principles followed by the organizational management in providing the welfare facilities are given below.

  • The welfare measures are to meet the real needs of the employees. This means that the management must first determine what the employees’ real needs are with the active participation of the employees.
  • There are the difference in age, sex, marital status and number of children, type of job, and the income level of employees. Hence there exist large differences in the needs of employees for the welfare measures. Management is to balance these needs while providing the welfare measures.
  • The management is to assume a benevolent posture while providing the welfare measures.
  • The expenditure on the welfare measures are to be planned properly in the budget and its financing is to be established on a sound basis.
  • There is to be periodical assessment or evaluation of the benefits of the welfare measures and necessary timely actions are to be taken on the basis of feedback.

Approaches to the employees’ welfare 

Various organizations adopt different approaches for the employees’ welfare measure. These approaches refer to the beliefs and attitudes held by the management of the organization providing the welfare facilities. Some organizations provide employees’ welfare facilities inspired by religious faith, others as a philanthropic duty and the like.

The various approaches to employees’ welfare measures reflect the attitudes and beliefs of the organizational managements. These days, most of the managements understand the importance of the employees’ welfare measures and provide welfare facilities voluntarily and with enlightened willingness and enthusiasm.

In a recent study of the approaches to employees’ welfare, it has been shown that it is desirable for the management to have these facilities. Different approaches for the welfare facilities are described below.

  • The policing approach – This approach is applicable to those organizations where the management of the organization exploits the employees in an unfair manner. This can be by making the working hours longer, by paying low wages to the employees, by keeping the workplaces in an unhygienic condition, by neglecting safety and health provisions, and by ignoring the provision of elementary human amenities, such as drinking water, toilet blocks, rest rooms and canteens. Since this approach is not acceptable to the statutory authorities, they assume the role of a policeman, and compel the organizational management to provide welfare facilities as per statutory requirements.
  • The approach through religion – The approach through religion has two aspects namely (i) the investment aspect and (ii) the atonement aspect. The investment aspect implies that the fruits of today’s deeds will be reaped tomorrow. Any action, good or bad is therefore treated as an investment. Inspired by this belief, some organizational management plans and organizes facilities like canteens and creches etc. The atonement aspect implies that the management experiences some catastrophe or disaster before realizing that the catastrophe or disaster is due to the management ignoring the employees’ welfare. After experiencing such unwanted incident, the management, as atonement of wrong deeds earlier, starts investing liberally in the employees’ welfare measures.
  • The philanthropic approach – Philanthropy means affection for mankind. The philanthropic approach to the employees’ welfare refers to the provision of good working conditions, creches, and canteens etc. out of pity on the part of the organizational management. This approach helps the employees in case of their disabilities. The philanthropic approach is more common in case of social welfare. Student hostels, drinking water facilities, the rehabilitation of crippled employees, and donations to religious and educational institutions, and so forth are examples of philanthropic approach.
  • The paternalistic approach – The paternalistic approach is also called the trusteeship approach of employees’ welfare. Under this approach the management forms a trust independent of the organization for providing the welfare facilities to the employees. Employees are represented in the trust management either by election or by appointment by the management. The role of the organizational management is to provide funds to the trust. The trust funds are controlled by the trust management. The trusteeship approach is not legal, but quite effective.
  • The placating approach – This approach is based on the assumption that appeasement pays. This approach is followed in some organizations where the employees are organized and they have somewhat militant attitude. Management buys peace in these organizations for providing the welfare facilities by following this approach.
  • The public relations approach – According to this approach, welfare activities are provided by the management to create a good impression on the minds of the employee and to build a good corporate image in the public, particularly the latter. Clean and safe working conditions, a good canteen, and creche etc. make a good impression on the employees, visitors and the public. Some management proudly takes their visitors round the plant to show how well they have organized their welfare activities.
  • The functional approach – This approach is also known as the efficiency theory of employees’ welfare. The functional approach implies that welfare facilities are provided to make the employees more efficient. This approach says that and if the conditions of environment around the employees are congenial then they work more efficiently. Welfare work is a means of securing, preserving and increasing the efficiency of the employees.
  • The social approach – The social obligation of the organization has been assuming great significance these days. Some management includes employees’ welfare measures as a part of their social obligations. The social approach implies that the organization is morally bound to improve the conditions of the society around it which also implies the improvement in the living condition of its employees.

Though there are the above eight approaches available to the organizational management with respect to the provision of employees’ welfare facilities, but the management which take advantage all these approaches and provides all the required welfare facilities to the employees ultimately comes out as a winner. Such organization has not only good corporate image but it also has satisfied employees who contribute whole heatedly to the success and the growth of the organization.