Define Fringe benefits? Write the objectives of fringe Benefits.
Define Fringe benefits? Write the objectives of fringe Benefits.
Or
What is fringe benefit?
Ans.
Definitions of Fringe Benefits
Meaning and Definitions of Fringe Benefits
Fringe benefits (perks) include most benefits given to employees in addition to their salary or wages. We should also be aware of attributed and non-attributed benefits. Fringe benefit tax (FBT) is a tax on benefits that employees receive and enjoy as a result of their employment. FBT replaces the PAYE tax that would be deducted from the employee if the employee was given the money to purchase the benefit as part of salary or wages instead of the actual benefit.
These are as under:
According to Encyclopedia of Social Sciences, “Fringe benefits are the legal and voluntary efforts of employers for improving the standard of living and working conditions of their workers.”
According of International Industrial Conference Board, “Fringe benefits must have four elements: (i) Payment in addition to the payment for the time of work at pre-determined rate such as, overtime, leave encashment etc.: (ii) Payment for the purpose of safety of employees, (iii) Payment for idle time. (iv) Payment for the services of employees.”
According to International Labour Organisation, “Wages are often augmented by special benefits by the provisions of medical and other services, or by the payments in kind that form part of the wage expenditure on other goods and services. In addition workers commonly receive such benefits such as holidays with pay, low cost meals, low rent housing etc. such additions to the wage proper are sometimes referred to as ‘fringe benefits – Benefits that have no relation to employment or wage should not be regarded as fringe benefits even though they may constitute a significant part of worker’s total income.”
According to International Labour Organisation, “Fringe Benefits are the services, facilities and comforts available within and near by the enterprise so that the employees working in the enterprise may work in healthy and peaceful circumstances and take the advantage of these facilities to improve the level of their health and moral.”
According to Employers Federation of India, “Fringe benefits include payments made for time not worked, profit and other bonuses, legally required payments on social security schemes, workmen’s compensation, welfare cess and the contributions made by employers under such voluntary schemes such as catered for the post-retirement, medical, educational, cultural and recreational needs of workmen. The term also includes the monetary equivalent of free light, water, fuel etc. paid to workers and of subsidized housing and related services.”
The main features of fringe benefits-
1. This is the supplementary form of compensation.
2. This is paid to all employees based on their membership in the organisation.
3. This is indirect compensation because they are usually extended as a condition of employment and are not directly related to performance.
4. It is helpful to raise the living conditions of employees.
5. This is may be statutory or voluntary. Provident fund is a statutory benefit where as transport facility is a vlountry benefit.
Objectives of Fringe Benefits
These are as follows:
1. To attract capable and experienced persons,
2. To meet the various needs of the employees,
3. To protect the interests of employees and to compensate the losses and risks,
4. To boost the morale,
5. To check industrial disputes,
6. To maintain discipline.
