INTRODUCTION

Management is concerned with attracting and keeping employees, whose performance meets at least minimum level of acceptability; and at keeping absenteeism and turnover to tolerable level. The provision of benefit and services can be and are important in maintaining the employees and reducing or keeping turnover and absenteeism low. The primary effect of fringe benefit type of compensation is to retain the employee in the organization on the long term bases. There is little or no evidence that the tremendous variety of supplementary pay plans, often term fringe benefits serve to motivate employees to a higher productivity. Different forms of supplementary compensation have a variety of titles in industry. Some refer to them as service programmes; other characterize as non- wage payments, or employee benefits, still others emphasize the cost and label them hidden pay role. Typically they have been most often referred to as fringe benefits. In the broadest sense such fringes can be construed to include all expenditures designed to benefit employees over and above regular base pay and direct variable compensation related to output. It is important to note that financial incentives are paid to specific employees whose work is above standard. Employee benefit and services on the other hand are available to all employees based on their membership in organization. The purpose of such benefit and services is to retain people in the organization and not to stimulate them to greater effort and higher performance. They foster loyalty and act as a security base for the worker. What is a Fringe Benefit? These benefits are usually known as fringe benefits-as they are offered by the employer to the employee as a Fringe. The Glossary of Current Industrial Relations and Wage Terms has defined fringe benefits as Supplement to wages received by workers at a cost to employers. The term encompasses a number of benefits-paid vacations, pension, health and insurance plans, etcwhich usually add up to something more than a fringe and is sometimes applied to a practice that may constitute a dubious benefit for workers. The International Labour Organization has defined fringe benefits as Wages are often augmented by special cash benefits, by the provision of medical and other services, or by payment in kind that form part of the wage for expenditure on the goods and services. In addition

workers commonly receive such benefits as holidays with pay, low-cost meals, low-rent housing, etc. such addition to the wage proper are sometimes referred to as fringe benefits. The United States Chamber Of Commerce includes five categories of services and benefits under the term fringe benefits. These are: Legally required payments- old age pensions, survivor benefit, disability pension, health insurance, unemployment insurance, separation pay and payment made under the Workmans Compensation act; Pension and group insurance; and welfare payments; Paid rest period, waste up time, lunch period; Payment for time not worked- vacations and holidays, Christmas bonus

According to the Employers Federation of India, fringe benefits include payment for non working time, profit and bonus, legally sanctioned payments on social security schemes, workmens compensation, welfare cess and contributions made by employers under such voluntary schemes as cater for post retirement, medical. Educational, cultural and recreational needs of workers. The term also includes the monetary equivalent of free lighting, water, fuel, etc., which are provided for workers, and subsidized housing and related services. Thus, fringe benefit is primarily a means in the direction of ensuring, maintaining and increasing the income of the employee. It is a benefit which supplements to a workers ordinary wages and which are of the value to them and their families in so far as it materially increases their retirement. Salient Features of Fringe Benefits: Fringe benefits are those payments or benefits which a worker enjoys in addition to wages or salaries he receives. These benefits are not given to workers for any specific jobs they have performed but are offered to them to stimulate their interest in their work and to make their jobs more attractive and productive for them.

 Fringe benefit represents a labour cost for the employer, for it is an expenditure which he incurs on supplementing the average money rates due to his employees who have been engaged on the basis of time schedule. It is not on the basis of hard work or long hours of work put in by an employee but on the basis of the length of the service, sickness, sex, hazards of life he encounters in the course of his work, etc. To be termed a fringe benefit, a labour cost should be intended by an employer as a benefit desired by his staff. A fringe must constitute a positive cost to the employer and should be incurred to finance an employees benefits. Objectives of Fringe Benefit and Service Programmes: I. To keep in line with the prevailing practices of offering benefits and services which are given by similar concerns. II. To recruit and retain the best personnel. III. To provide for the need of employees and protect them against certain hazards of life, particularly those which an individual cannot himself provide for. IV. To increase and improve employees morale and create a helpful and positive attitude on the part of workers towards their employers. V. To make the organization a dominant influence in the lives of its employees with a view to gaining their loyalty and cooperation, encouraging them to grater productive efforts. VI. To improve and furnish the organizational image in the eyes of the public with a view to improving its market position and bringing about product acceptance by it.
To recognize the official trade union generally constrains an employer to adopt a sound benefits-andservices programmes for his employees

Coverage of Benefits:
It has been recognized that certain benefits must be supplied by the organization for its employees, regardless of whether it wants to or not. With few exceptions the hiring of any employee requires the organization to pay social security premiums, workmens compensation, etc. Similarly, the payment of these costs by the organization provides the employee with financial protection at retirement, termination or as a result of injury and it also provides to the workers dependants in case of the employees death

Classification of fringe benefits The National Association of Manufacturers has indicated the following classification of fringe benefits: a) Premium Payments for the period of time a worker has worked; for e.g. payment on daily or weekly basis, holydays, overtime pay, the cost of living bonus, bonus in lieu of vacations. b) Payment for special duties, such as working on grievance redressal procedures and labour contract negotiations. c) Payment for health and security benefits. These include retirement plans, social security Payments, saving plans, medical, surgical and hospital insurance, accident and sickness insurance, disability insurance, etc. d) Payment for time not worked, which includes payment for sick leave and for time during which an employee is under medal care, payment for holydays, vacations, witness time, voting time, lunch period, rest period, reporting pay, severance pay, payment for call in time, call back time, etc. e) Payment for employee services, including cafeteria subsidies, union credit, house financing, parking space operations, etc. f) Other expenditure, such as that incurred on making festival gifts, or offering festival bonus, on educational reimbursements, employee uniforms, etc. Cockman, however has made two fold classifications of fringe benefits: I. Those which are offered on the basis of status- car, holyday, foreign travel, telephone; security- insurance and medical benefits childrens educational facilities;

and work benefits- office accommodation, secretarial services, management training; and II. Those which are key benefits, i.e., share schemes, profit sharing, retirement benefits, and house purchase facilities. On the basis of their identification however, benefits may be classified as under: a. Employee Security Payment: These include: i. Employer contributions stipulated in legal enactments, and payment under Workmens Compensation Act. ii. Supplemental unemployment benefits iii. Accident insurance iv. Pensions v. Contribution to savings plans and health and welfare funds b. Payment for time not worked: under this are included call back and call in pay; health in the family leave; holiday pay; medical time; paid lunch period; pay for religious holidays; paid sick leave; payment for time spend on collective bargaining and on redressal of grievances; payment for the time spent on casting ones vote at election time, etc. c. Bonus and Awards: these consist of such financial amenities and advantages as holiday; attendance bonus; Diwali bonus; bonus for good quality workmanship; safety award; suggestion award; year end bonus; etc. d. Employee Services: these services include: i. Services related to the type of work performed, including subsidies for purchase and upkeep of work clothing and uniforms and of the various types of tools used by a worker in the course of his work. ii. Eating facilities which include the provision of company restaurants, cafeterias, canteens, and fully or partially subsidized food. iii. Transportation facilities

There are many unusual benefits rather than these fringe benefits like, a firm provides a free jet flight anywhere in the world on the tenth anniversary of service with the firm. Other noted benefits are facelifts for executives and spouses, off-track-betting breaks, adoption fees, no smoking pay, paternity leave, well pay, weight-loss pay and self-defense training.
OBJECTIVES OF STUDY

Primary Objective: To understand the application and impact of fringe benefits on employees motivation.

Secondary Objectives: To study the role of fringe benefits in employer and employee relationship. To find out the problem involved in relation to fringe benefits
SCOPE OF THE STUDY The study covered the following areas: Impact of fringe benefits on employees commitment towards organization. Importance of fringe benefits for inducing a sense of belongingness towards the organization. The role of fringe benefits on employees motivation. The influence of awareness about fringe benefits received by the employees on their overall performance. The loopholes related to fringe benefits.