SYNOPSIS ON

“ROLE OF FRINGE BENEFITS IN THE

MOTIVATION OF EMPLOYEES
WORKING IN THE ORGANISATIONS”

SUBMITTED TO: SUBMITTED BY:

Miss Swati Singh Anju singh

Roll no.0844070005

FRINGE BENEFITS

Any nonwage payment or benefit granted to employees by employers. Examples include

pension plans, profit-sharing programs, vacation pay, and company-paid life, health, and
unemployment insurance. Employers' payments for fringe benefits are included in
employee-compensation costs and therefore are not usually taxed. If the cost of fringe
benefits were paid directly as wages, the worker would pay taxes on this amount and
therefore have less to spend when purchasing equivalent benefits independently.
Compensation to employees in addition to salary. Some examples of fringe benefits are
paid holidays, retirement plans, life and health insurance plans, subsidized cafeterias,
company cars, stock options, and expense accounts. In many cases, fringe benefits can
add significantly to an employee's total compensation, and are a key ingredient in
attracting and retaining employees. For the most part, fringe benefits are not taxable to
the employee, though they are generally tax-deductible for the employer.

Employee benefits ( benefits in kind (also called fringe benefits, perquisites, perqs
or perks) are various non-wage compensations provided to employees in addition to their
normal wages or salaries. Where an employee exchanges (cash) wages for some other
form of benefit, this is generally referred to as a 'salary sacrifice' arrangement. In most
countries, most kinds of employee benefits are taxable to at least some degree.

Some of these benefits are: housing (employer-provided or employer-paid), group

insurance (health, dental, life etc.), disability income protection, retirement benefits,
daycare, tuition reimbursement, sick leave, vacation (paid and non-paid), social security,
profit sharing, funding of education, and other specialized benefits.

The purpose of the benefits is to increase the economic security of employees.

The term perqs or perks is often used colloquially to refer to those benefits of a more
discretionary nature. Often, perks are given to employees who are doing notably well
and/or have seniority. Common perks are take-home vehicles, hotel stays, free
refreshments, leisure activities on work time (golf, etc.), stationery, allowances for lunch,
and—when multiple choices exist—first choice of such things as job assignments and
vacation scheduling. They may also be given first chance at job promotions when
vacancies exist.

OBJECTIVES OF FRINGE BENEFITS

The view point of employers is that fringe benefits form an

important part of employee incentives to obtain their loyalty and
retaining them. The important objectives of fringe benefits are:

1. To create and improve sound industrial relations

2. To boost up employee morale.

 3. To motivate the employees by identifying and satisfying their
unsatisfied needs.

4. To provide qualitative work environment and work life.

5. To provide security to the employees against social risks like

old age benefits and maternity benefits.

6. To protect the health of the employees and to provide safety to

the employees against accidents.

7. To promote employee’s welfare by providing welfare measures

like recreation facilities.

8. To create a sense of belongingness among employees and to

retain them. Hence, fringe benefits are called golden hand-cuffs.

9. To meet requirements of various legislations relating to fringe

benefits.

TYPES OF FRINGE BENEFITS

Organizations provide a variety of fringe benefits. The fringe benefits

are classified under four heads as given here under:

• For Employment Security :

Benefits under this head include unemployment, insurance, technological adjustment

pay, leave travel pay, overtime pay, level for negotiation, leave for maternity, leave
for grievance, holidays, cost of living bonus, call-back pay, lay-off, retiring rooms,
jobs to the sons/daughters of the employees and the like.
 • For Health Protection:

employer provided health benefits including reimbursment and

insurance are generally excluded from the income of the
employees.

• .For Old Age and Retirement:

Benefits under this category include: deferred income plans,

pension, gratuity, provident fund, old age assistance, old age
counselling , medical benefits for retired employees, traveling
concession to retired employees, jobs to sons/daughters of the
deceased employee and the like.
4.For Personnel Identification, Participation and Stimulation:
This category covers the following benefits: anniversary awards,
attendance bonus, canteen, cooperative credit societies,
educational facilities, beauty parlor services, housing, income tax
aid, counseling, quality bonus, recreational programs, stress
counseling, safety measures etc.

Advantages of fringe benefits

There are a number of advantages to fringe benefits for both employer and employee

Employer advantages
• Boost employee's morale and pride in the company.
 • Helps attract and retain better qualified employees.
• Provides high risk coverage at low costs easing the company's financial burden.
• Improves efficiency and productivity as employees are assured of security for
themselves and their families.
• Premiums are tax deductible as corporation expense, which means savings with
quality coverage.

Employee advantages
• Provide tax benefit to the employees.
• Peace of mind leading to better productivity as employees are assured of
provision for themselves and families in any mishap.
• Employees with personal life insurance enjoy additional protection.
• Confidence in company's employee benefit schemes boost staff morale and pride
in company.

RESEARCH METHODOLOGY

HYPOTHESIS
Fringe benefits act as a motivational tool in the organizations.
SAMPLE SIZE

60 employees from 5 organizations

DATA COLLECTION METHODS

PRIMARY DATA
SECONDARY DATA

DATA ANALYSIS METHODS

Pie charts
Bar charts