CHAPTER - 1

INTRODUCTION
 
1.1.1 Background of the study
Labour welfare occupies a place of significance in the industrial development
and economy. It is an important facet of industrial relations, the extra dimension,
giving satisfaction to the worker in a way which even a good wage cannot with the
growth of industrialization and mechanization, it has acquired added importance. A
happy and contented workforce is an asset for the industrial prosperity of any nation.
Labor welfare is nothing but the maintenance function of personnel in the sense that
it is directed specifically to the preservation of employee health and attitudes.
Labour welfare work aims at providing such service facilities and amenities
which enable the workers employed in an organization to perform their work in
healthy congenial surrounding conductive to good health and high morale. Labour
welfare is a comprehensive term including various services, benefits and facilities
offered by the employer. Through such generous fringe benefits the employer makes
life worth living for employees. The welfare amenities are extended in additional to
normal wages and other economic rewards available to employees as per the legal
provisions. Welfare measures may also be provided by the government, trade unions
and non-government agencies in addition to the employer. “International Labour
Organization efforts to make life worth living for workers” According to the Oxford
dictionary “Welfare is fundamentally an attitude of mind on the part of management
influencing the method by which management activities are undertaken.
Welfare of employee and his family members is an effective advertising and
also a method of buying the gratitude and loyalty of employees. Employee welfare is
a comprehensive term including various services, benefits and facilities offered by
the employer. The basic purpose of labour welfare is to enrich the life of employees
and keep them happy and contented. Welfare facilities enable workers to have a
richer and more satisfying life. It raises the standard of living of workers by
indirectly reducing the burden on their pocket. Welfare means improving, faring or
doing well.
 Labour welfare is an important aspect in every organization with some added
incentives which enable the workers to lead a decent life. There are several agencies
involved in the labour welfare work namely the central government, employer’s trade
union and other social service organization. Welfare services may broadly
be classified into two categories are intramural and extramural. In order to get the
best out of a worker in the matter of production, working condition is required to be
improved to large extent. The work place should provide reasonable amenities for the
worker’s essential need. Today various medical services like hospital, clinical and
dispensary facilities are provided by organizations not only to the employees but also
to their family members. Normally welfare and recreational benefits includes
canteens, housing, transportation, education etc.

1.1.2 MEANING OF LABOUR WELFARE MEASURES

Welfare is a broad concept referring to a state of living of an individual or a
group, in a desirable relationship with the total environment-ecological, economic
and social. The term ‘welfare’ includes both the social and economic contents
of welfare.
Social welfare is primarily concerned with the solution of various problems
of the weaker sections of society like prevention of destitution and poverty. The
economic welfare is to promote economic development by increasing production and
productivity and through equitable distribution. Labour welfare is a part of social
welfare, conceptually and operationally.
Labour welfare may be viewed as a total concept, as a social concept and a
relative concept. The total concept is a desirable state of existence involving the
physical, mental, moral and emotional well-being. These four elements together
constitute the structure of welfare, on which its totality is based labour welfare
implies the setting up of minimum desirable standards and the provision facilities
like health, food, clothing, medical, assistance, education, insurance, job security,
recreation, and so on. All measures and activities undertaken by the government,
employers and association of workers for improvement of standard of living of
workers and promotion of their social well-being are called labour welfare.
1.1.3 DEFINITION OF LABOUR WELFARE

Labour welfare means anything done for the comfort and improvement- intellectual
or social, of the employees over and above the wages paid which is not a necessity of
the industry.”

- Arthur James Todd 1933

“Labour welfare is efforts to make life worth living for workmen.”

- The oxford Dictionary

“The labour welfare work covers all the efforts which the employers make for the
benefit of their employees over and above the minimum standards working
conditions fixed by the factory act and over and above the provisions of the social
legislations providing against accident, old ages unemployment and sickness.”

- Joshi N M

1.1.4 FEATURES OF LABOUR WELFARE

 Labour welfare is a comprehensive term including various services, facilities 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 under legal provisions and collective bargaining.
 Labour welfare is dynamic in nature varying from country to country, region to
region and organization to organization.
 Labour welfare is a flexible and ever changing concept as new welfare measures
are added from time to time to the existing measures.
 Welfare measures may be introduced by the employers, government, employees
or by any social or charitable agency.

1.1.5 CATEGORIES OF WELFARE MEASURE

a) Statutory welfare measure
 b) Non Statutory welfare measure
Figure: 1.1 Classification of welfare measures

Statuary welfare
WELFARE
MEASURE
Non Statuary welfare  Voluntary welfare

Mutual welfare

Organizations provide welfare facilities to their employees to keep their motivation

levels high. The employee 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 employee 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.

I. Statutory Welfare Measure

The statutory welfare benefits schemes include the following provisions:

1. Drinking Water: At all the working places safe hygienic drinking water should
be provided.
2. Facilities for sitting: In every organization, especially factories, suitable seating
arrangements are to be provided.
3. 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 employee.
 4. 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.
5. Canteen facilities: Cafeteria or canteens are to be provided by the employer so
as to provide hygienic and nutritious food to the employees.
6. 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
same are to be maintained in a hygienic condition.
7. Lighting: Proper and sufficient lights are to be provided for employees so that
they can work safely during the night shifts.
8. 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.
9. 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.
10. Rest rooms: Adequate numbers of restrooms are provided to the workers with
provisions of water supply, wash basins, toilets, bathrooms, etc.
11. Maternity & Adoption Leave – Employees can avail maternity or adoption
leaves. Paternity leave policies have also been introduced by various companies.
12. Medi-claim Insurance Scheme: This insurance scheme provides adequate
insurance coverage of employees for expenses related to hospitalization due to
illness, disease or injury or pregnancy.
II. Non Statutory Welfare Measure

Many non-statutory welfare benefits may include the following schemes:

1. Personal Health Care (Regular medical check-ups): Some of the companies
provide the facility for extensive health check-up
2. Flexi-time: The main objective of the flexi time policy is to provide opportunity
to employees to work with flexible working schedules. Flexible work schedules
are initiated by employees and approved by management to meet business
commitments while supporting employee personal life needs
3. Employee Assistance Programs: Various assistant programs are arranged like
external counselling service so that employees or members of their immediate
family can get counselling on various matters.
4. Employee Referral Scheme: In several companies employee referral scheme is
implemented to encourage employees to refer friends and relatives for
employment in the organization.
5. Harassment Policy: To product an employee from harassments of any kind,
guidelines are provided for proper action and also for protecting the aggrieved
employee.
Non-statutory welfare measures can be divided into two types:
Figure: 1.2 Non-statutory welfare measures

Voluntary
welfare Mutual
welfare

A. Voluntary welfare - The facilities which are voluntarily provided by the

employers come under this category. Hence these are not statutory. No doubt,
the activities under this category ultimately lead to increase in the efficiency of
workers.
B. Mutual welfare - These facilities are usually outside the scope of the statutory
facilities. These activities are voluntarily undertaken by the workers themselves
for their own interest. As such the employer has no say in it.
1.1.6 THEORES OF LABOUR WELFARE

The theories of labour welfare reflect the evolution of the concept of welfare.
Earlier, the Government had to compel the industrial organizations to provide basic
amenities to their employees. Such compulsion was necessary because the employers
used to exploit the labour and treated them in an unfair manner. With the passage of
time, the concept of welfare has undergone changes. Progressive managements today
provide welfare facilities voluntarily and with enlightened willingness and
enthusiasm. In fact, welfare facilities are no longer restricted to workers alone but
also extended to social welfare also. In this regard, a brief description of the various
theories of employee welfare has been outlined hereunder.

Figure: 1.3 Theories of Labour Welfare

Policing
Theory
Functional Religion
Thoery Theory

Theories
of
Public Labour
Welfare Philanthropic
Relation
Theory
Thoery

Plcating Trusteeship
Theory Theory

1. The Police Theory:

The police theory is based on the contention that a minimum standard of welfare is
necessary for labourers. Apparently, this theory assumes that man is selfish and self-
centered, and always tries to achieve his own ends, even at the cost of the welfare of
others. If wealth or authority or both help him to be in an advantageous position, he
uses it for his own advantage, exploiting those who are under him. According to this
theory, owners and managers of industrial undertakings get many opportunities for
this kind of exploitation. The welfare state has to prevent this kind of exploitation
and coerce the industrialists to offer a minimum standard of welfare to their workers

2. The Religious Theory: 

This theory is based on the concept that man is essential “a religious animal”. Even
today, many acts of men are related to religious sentiments and beliefs. These
religious feelings, sometimes, prompt an employer to take up welfare activities in the
expectation of future benefit, either in this life or in some future life. According to
this theory, any good work is considered as “Investment”. In this case, both
benefactor and the beneficiary are rewarded. Many trusts and charitable institutions
in India function on the basis of this belief. According to this theory, man is
primarily concerned with his own welfare and only secondarily with the welfare of
others. The religious basis of welfare, however, cannot be rational.

3. The Philanthropic Theory: 

This theory is based on man’s love for mankind. In Greek, ‘philo’ means love of and
‘anthropes’ means man. So philanthropic means loving mankind. Man is believed to
have an instinctive urge by which he strives to remove the sufferings of others and
promote their well-being. This drive may be a rather powerful one and may impel
him to perform noble sacrifices. When some employers have compassion for their
fellowmen, they may undertake labour welfare measures for the benefit for their
workers.

4. Trusteeship Theory: This is also called the paternalistic theory of labour

welfare, according to which “the industrialist or employer holds the total industrial
estate, properties and profits”. These properties and profits, he uses for himself, for
the benefit of his workers and also for society. Workers are like minors. They are
ignorant because of lack of education and are not able to look after their own
interests.

5. The Placating Theory: This theory is based on the fact that labour groups are
becoming more militant and are conscious of their rights and privileges than ever
before. Their demand for higher wages and better standards cannot be ignored.
According to this theory, timely and periodical acts of labour welfare can appease the
workers. They are some kind of pacifiers by way of friendly gestures.
6. The Public Relations Theory: This theory provides the basis for an atmosphere
of goodwill between labour and management and also between management and the
public. Labour welfare programs, under this theory, work as a sort of an
advertisement and help an industrialist to build up good and healthy public relations.
This theory is based on the assumption that the labour welfare movement may be
utilized to improve relations between management and labour.

7. The Functional Theory: This is also called Efficiency Theory. Here, welfare

work is used as a means to secure, preserve and develop the efficiency and
productivity of labour. It is obvious that if an employer takes good care of his
workers, they will tend to become more efficient and thereby they step up
production. But all this will depend on a healthy collaboration between union and
management and their mutual concern for the growth and development of the
organization.

1.1.7 PRINCIPLES OF LABOUR WELFARE

1. Principle of Social Responsibility: Labour welfare is not philanthropy. It must be

taken as a social responsibility by the employers; because the working class cannot
be left pauperized and poverty ridden. The social and economic inequality brings not
only psychological and social unrest, but also reduces the job involvement and
breeds inefficiency.

2. Principle of Democratic Values: Democracy is based on social justice. It is

based on the principle of equity and equality. The widening gap between the rich and
the poor is an unhealthy sign of democracy. The working class, therefore, must be
provided welfare amenities, which will help reduce the income gaps and would,
ultimately, result in improved job satisfaction.

3. Principle of Fair Wages: The services should meet the workers’ real needs. This
means that the management must determine with active involvement by the
employees, what the true needs of the employee are. A cafeteria may be used to
manage the operation. The principle of adequacy of wages concedes that labour
welfare services are not a substitute for wages, instead it is to motivate the workers
for better performance. And that would result in better working and social life for
workers.

4. Principle of Work Efficiency: If the industry provides labour welfare services

and amenities to the workmen, it will result in improvement in their work efficiency,
which will result in higher productivity and greater competitive advantage for the
industries.

5. Principle of Reconstruction of Personality: When the needs and aspirations of

employees are taken care of, it results in development of positive approach in the
work force. The positive atmosphere, thus, created results in change in the
personality of employees. With the improved industrial relations situation, gradually
the personalities of the officials and the workmen get reconstructed in a positive
manner.

6. Principle of Shared Responsibility: The successful running of industrial

enterprise is the shared responsibility of both the workers and management. The
management must arrange for employee welfare activities in order to improve the job
morale of the work force, which would result in an amicable work environment and
higher productivity of the concern.

7. Principle of Universality of Welfare: The need of welfare services for employees

is universal in nature. It is needed to be provided to the working class everywhere in
the world and to all the categories of employees and workmen in all the countries and
all sorts of industries and other sectors.

1.1.8 BENEFITS OF LABOUR WELFARE MEASURES

Labour welfare benefits are the combinations of all efforts to make life worth
living for the worker. These play an important role in contributing to well- being,
prosperity and satisfaction of worker. These help to preserve the health and safety of
workers and also maintain their morale. With these benefits, workers will be
 increasingly adapted to their work which will reduce the absenteeism and labour
turnover in the industries. Labour welfare benefits are the fundamental requirements
of industrial development and economy because these give contentment and
happiness in a way which even a good wage cannot give. These will also give the
employers an image of caring and responsible employer.

 Improvement of Industrial Relations:

Labour Welfare measures are so comprehensive that they satisfy workers, if
properly implemented. This satisfaction on the part of workers is a great stimulus for
the industrial relations to improve. When workers are convinced that adequate
measures have been taken to improve their work environment and their conditions of
service, then they naturally repose confidence in the management and thus it helps
maintenance of industrial peace.

 Increase in the General Efficiency and Income:

Welfare facilities make the workers happy and contented both at home and
the factory and it brings improvement in their general efficiency. Their efficiency
and productivity may not be up to the mark, if they are not relieved of their domestic
worries like poor housing, insanitary conditions etc. Once they are relieved of these
worries, they work with full zeal and enthusiasm.

 High Morale:
The welfare measures shall also help in securing the willing cooperation of
the workers. Once satisfied they will be less tempted to destructive and anti-social
activities. Thus, a high degree of employee morale is ensured.

 Creation of Permanent Labour Force:

These facilities will provide an attraction to the workers to stay longer in the
undertaking. In the absence of such facilities, the workers often leave for their
villages in search of recreation etc. Efficient workers can also search for better
chances and may switch over to other establishments. In order to create a permanent
labour force, such facilities are essential.
 Improvement of the Moral and Mental Health of Workers:
Welfare measures include such measures as would prevent the workers from
indulging in vices such as drinking, gambling etc. and thus their moral and mental
health improves, contributing overall improvement in the health of the organization
and society.

 Social Benefits:
Besides the various economic advantages to the employers and employees,
these measures also offer various social advantages. The increase in the efficiency of
the workers ultimately leads to an increase in production, productivity and the
earnings of the undertakings. The increased earnings also lead to higher wages and
make the workers happier and enable them to live “a richer and fuller life”. Finally,
the living standard of the society is raised.

LABOUR WELFARE IN INDIA

Pre – Independence

The origin of labour welfare activity in India goes back to 1837, following the
abolition of slavery in the year 1833 and British colonies started importing Indian
labour. Then the labour welfare activity was mainly controlled by legislation and the
earliest act in this regard was the Apprentices Act of 1850, which was passed to
protect the orphaned children to learn various trades with the help of experienced
craftsmen.

The next act was the Fatal Accidents Act of 1853 aimed at providing
compensation to the families of workmen who lost their lives as a result of any
actionable wrong at workplace. This act was followed by the Merchant shipping act
of 1859, which intended to regulate the employment of seamen and provided for their
health, accommodation and protection.

The conditions of the labour that worked in the textile mills in Bombay in the
1870 onwards were the immediate cause for this act to be enacted. Some of the
conditions of the workers during those time were, children below the age of 8 years
were employed, the hours of work was between sunrise to sunset, there were no fixed
holidays and under all normal conditions the mills were working for not less than 320
days in a year and the conditions inside the working area were not fit for humans to
work and the levels of safety was inadequate.

Thus the Indian Factories Act of 1881 was made applicable to all the factories
using mechanical power employing not less than 100 persons and working more than
4 months in a year. Further the following is highlighted of the act.

 Children below the age of 7 could not be employed, while those between the age
of 7 and 12 were not to work for more than 9 hours a day.
 They were also to get 4 holidays every month
 State was empowered to appoint factory inspectors to oversee the functions of the
factories
 Dangerous machineries were to be properly fenced and every accident need to be
reported to the factory inspector.
 Following the international conference on labour at Berlin, and on the advice of
the special commission on labour the following amendments were made in the
year 1891 to the factories act of 1881.It applied to all the factories employing 50
persons or more and could be extended to those who have 20 workers.
 A mid-day break for half an hour was made compulsory
 Women were allowed to work for a maximum of 11 hours with a break for 1 and
half hours.
 The lower age limit for the worker was raised from 9 years to 14 years and were
not allowed to work for more than 7 hours a day.
 Local governing bodies were empowered to make rules regarding sanitation and
other amenities for workers

During these periods various voluntary actions in the fields of labour welfare
also made considerable progress. In the year 1910 the Kamgar Hitwardhak Sabha
was established with the aim to help workers in a variety of ways and the most
important being the labour welfare functions.

AFTER INDEPENDENCE
 After independence, the labour welfare movement acquired new dimension. It
was realized that labour welfare had a positive role to play in increasing productivity
and reducing industrial tensions. The State began to realize its social responsibilities
towards weaker sections of the society. The emergence of different central trade
union organizations like INTUC (1947), HMS (1948), UTUC (1949). BMS (1955),
CITU (1970), NLO (1969), gave a further fillip to the growth of labour welfare
movement.

The labour welfare movement acquired new dimensions. For the requirement
of massive investments in industry during this period, it was felt necessary that
labour welfare played a positive role in increasing productivity and reducing
industrial tensions. The state too seriously took its social responsibility to the weaker
and working sections of the population. Thus the factories act of 1948 was enacted
that replaced all previous legislations

Welfare practices in India presently

Many welfare amenities described in the main report of the labour

investigation committee have become a part of the statutory obligations. The
different welfare amenities are under the various heading as follows.

Sanitary and Hygiene Facilities  The maintenance of a clean, sanitary and

hygienic working environment is now accepted as an important basic welfare
amenity that would include toilets, water for drinking and washing.

The factories act requires that every factory must be kept clean and free from
effluents flowing from any drain, that a sufficient supply of wholesome drinking
water must be made available at suitable and convenient points and separate latrines
and urinals for male and female workers be provided and spittoons and washing
facilities be provided.

Rest facilities  This amenity prescribes a prescribed number of seats on the shop
floor and in rest rooms or shelters in order to reduce fatigue as it enables a worker to
take a break. Further the act also makes provisions for lunch rooms to be provided if
there are more than 150 workers and these places be clean, well-lighted and
ventilated and provided with adequate furniture and drinking water wherever
necessary.

Feeding facilities  Every factory employing 150 or more workers should provide a
lunch room with provision for drinking water to enable workers to eat the meals
brought by them and where over 250 or more workers are employed, there should be
a canteen or canteens. In fulfilling the objectives of an industrial canteen, several
points like the following should be kept in mind.  It should be managed on a
nonprofit basis. Medical Facilities - The importance of preventive and curative
medical care has increased and it is now accepted theory that health care for workers
will help to reduce the incidence of sickness and therefore absenteeism among them
and will increase productivity. - The Factories Act of 1948 provided for cleanliness,
disposal of wastes and effluents, ventilation and temperature control, dust and fume,
artificial humidification, restriction regarding overcrowding, lighting, drinking water
arrangements, latrines and urinals and spittoons etc.

Statutory medical facilities were also provided under the Employees State
Insurance Act 1948, with subsequent amendments. This act extends such benefits to
industrial workers as maternity benefits, disablement benefits, dependents‟ benefits,
sickness benefits and medical benefits, while medical care and cash benefits were
also provided for workers.

Apart from the medical and health facilities provided by legislation and by
some employers on a voluntary basis, other similar services have been organized by
workers by labour welfare center and some trade unions.

REASONS FOR THE LABOUR WELFARE MEASURES IN INDIA

Following are the reasons for the labour welfare measures in India. By understanding
these reasons, the importance of labour welfare measuress can be understood:

 Increase in the efficiency of employees.

 Helpful in reducing the state of poverty among employees.
 Establishment of industrial Peace.
 Helpful in maintaining health and physical ability of employees.
 Helpful in reducing the rate of absenteeism and labour turnover.

1. Increase in the efficiency of the employees – Labour welfare activities increase

in efficiency of the employees to work. These facilities help in developing the
feeling of dedicating among them. Due to the increase in efficiency the
production and productivity of the enterprises increase considerably
2. Helpful in reducing the state of poverty among employees – A great problem
in industrial development of our country is extreme poverty among Indian
workers. Most of the workers in our country are unable in providing for base
necesicities for themselves and to their family members. Provision of labour
welfare activities plays an important role in reducing such poverty and providing
essential amenities to the workers.
3. Establishing Industrial peace – Labour welfare activities help in establishing
harmonious relations between employees and employers. Employees realize that
they are getting all possible facilities, and the employer take care of them, Such
feeling among employees is helpful in establishing industrial peace.
4. Helpful in maintaining health and physical ability of employees – Most of the
Indian workers are unhealthy and ill fed. It reduces the production capacity of the
employees. Provision of nourishing food and medical facilities help in
maintaining health physical ability of the employees.
5. Helpful in reducing the rate of absenteeism and labour turnover- The rate of
absenteeism and labour turnover is much higher in India as compared to that of
developed countries of the world. Provision of labour welfare activities help
reducing this arte because the workers feel themselves well settled at one place.