Everything you need to know about labour welfare. Labour welfare means “such services, facili­ties and amenities which may be established in, or in the vicinity of, an undertaking to enable the persons employed in them to perform their work in healthy, congenial surroundings and provided with amenities conducive to good health and high morale”.

Labour Welfare is not confined within the four walls of the workshop only. In and around the workplace lie conditions which have direct and indirect bearing on the welfare of labour.

So, la­bour welfare includes everything that is necessary to be done for the improvement of the conditions of labour in and around the workplace.

For instance, canteen and recreational facilities, sanitary and medical facilities, accommodation facilities, transport facilities from and to the workplace.


Learn about:-

1. Meaning of Labour Welfare 2. Definitions of Labour Welfare 3. Characteristics 4. Objectives 5. Features 6. Importance 7. Principles 8. Measures 9. Theories 10. Schemes 11. Merits and Demerits.

Labour Welfare: Meaning, Definitions, Objectives, Importance, Principles, Measures, Theories and Other Details


  1. Meaning of Labour Welfare
  2. Definitions of Labour Welfare
  3. Characteristics of Labour Welfare
  4. Objectives of Labour Welfare
  5. Features of Labour Welfare
  6. Importance of Labour Welfare
  7. Principles of Labour Welfare
  8. Different Labour Welfare Measures
  9. Theories of Labour Welfare
  10. Labour Welfare Schemes
  11. Merits and Demerits of Labour Welfare

Labour Welfare – Meaning

Labour welfare means “such services, facili­ties and amenities which may be established in, or in the vicinity of, an undertaking to enable the persons employed in them to perform their work in healthy, congenial surroundings and provided with amenities conducive to good health and high morale”.


Labour Welfare is not confined within the four walls of the workshop only. In and around the workplace lie conditions which have direct and indirect bearing on the welfare of labour. So, la­bour welfare includes everything that is necessary to be done for the improvement of the conditions of labour in and around the workplace. For instance, canteen and recreational facilities, sanitary and medical facilities, accommodation facilities, transport facilities from and to the workplace.

There is, however, no complete unanimity as to the meaning of labour welfare. “A series of sharp­ly diverse opinions exist on the motive and merits of industrial welfare work” (Arthur James Todd).

The concept of welfare is related to historical, cultural and environmental conditions. So it dif­fers from time to time and from country to country. In “The Modern Approach to Industrial Welfare” Paul Chu remarked – “Welfare services are as varied as life itself and are constantly being adapted to new circumstances. They form a fluid and developing pattern which changes as human needs change, as problems of adjustment to social environment arise or with the changes which are perpetually going on in the structure of society it­self.”

Certain principles should be adhered to while providing welfare facilities to the workers.


They are:

(1) Labour Welfare should not be considered as a substitute for low wages.

(2) Proper assessment must be made and priority must be fixed before any welfare measure is in­troduced.

(3) No compulsion should be made in the matter of providing labour welfare.


(4) Labour welfare schemes should involve work­ers.

Labour Welfare measures are intra-mural and extra-mural. Intra-mural facilities include facili­ties within the factory such as minimisation of in­dustrial fatigue, health measures, safety meas­ures, improvement in the condition of employment, recruitment, discipline, morale etc.

Extra-mural facilities consist of facilities outside the factory such as measures for the general well-being of the workers like good housing, recreation, amusement, education, sports & games etc. To derive best from workers, both these types of facilities should be provided to them.

Labour Welfare – Definitions

Exploitation of workers by the factory owners by making the workers work for long hours, paying low wages, neglecting health and safety provisions, providing unhygienic conditions of work etc., triggered the need of labour welfare. Different legislations are enacted by which managements are compelled to provide basic amenities to the workers. Some of the labour welfare activities are voluntarily undertaken by the organizations.


This is the result of the realization on the part of the management that labour welfare measures improve the overall living of the workforce and their morale and will positively contribute towards the production of the organization. Labour welfare means providing certain facilities and services to the employees for the betterment of their living and working conditions. The organisations undertake different labour welfare measures and many new welfare measures have come up along with social changes.

According to Arthur James Todd, “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.”

According to the Committees on Labour Welfare (1969), “Labour welfare includes such services, facilities and amenities as adequate canteen, rest and recreation facilities, sanitary and medical facilities, arrangements for travel to and from work and for the accommodation of workers employed at a distance from their homes and such other services, amenities and facilities including social security measures as they contribute to improve the condition under which workers are employed.”

In interpreting labour welfare, the Labour In­vestigation Committee remarked “Labour welfare activities include anything done for the intellec­tual, physical, moral and economic betterment of the workers whether by employers, by Govern­ment or by other agencies, over and above what was laid down by law or what was normally ex­pected as part of the contractual benefits for which the workers might have bargained”.


This definition of labour welfare is comprehensive. It gives a list of various measures which are hous­ing, medical and educational facilities, nutrition, facilities for rest and recreation, co-operative so­cieties, day nurseries and creches, provision of san­itary accommodation, holidays with pay, social insurance measures undertaken voluntarily by em­ployers alone or jointly with workers, provident funds, gratuities, pensions etc. All these measures are aimed at bringing about an all-round develop­ment of the workers, raising of their standard of living and make them enjoy better and lead a bet­ter life as happier citizens of the society.

The labour welfare activities are influenced by the social, moral and economic needs of workers and such activities differ from country to country and from region to region or from organization to organization.

Labour Welfare – 6 Important Characteristics

The important characteristics of labour welfare are:

i. The work which is usually undertaken within the premises or in the vicinity of the industrial undertakings for the benefit of the employees and the members of their family and this generally includes those items of welfare which are over and above what is provided by statutory provisions and what the employees expect as a result of a contract of employment from the employers.

ii. These facilities may either be provided voluntarily by the progressive and enlightened employers of their own, out of their realization of social responsibility towards labour or the statutory laws may compel them to make provision for these facilities or these may be taken up by the govt., or the trade unions.

iii. As far as the statutory measures to safeguard the welfare of factory workers are concerned, the beginning of the same was made with the passing of the Factories Act in 1881 as a result of the joint efforts of the philanthropist and social workers and Lancashire manufacturers in Britain. This Act applied to manufacturing establishments using mechanical power and employing 100 or more persons.

iv. The Act regulated the employment of child labour below 7 years and provided for 9 hours a day as the maximum working hours for children in the age group of 7 to 12 years, an interval of 1 hour for rest and a weekly holiday.

v. The Act also contained provisions relating to safety and inspection of factories.

vi. Later on, this Act was amended several times gradually expanding its scope to cover more and more persons within its ambit (by way of reducing the limit in terms of number of persons) and welfare measures, finally culminating in the Factories Act, 1948 (Which came into force on 1st April, 1949) which is in existence even today with some notable amendments introduced in 1954, 1976 and 1987.

Labour Welfare – Objectives

Apart from salary and wages different labour welfare activities are undertaken by the organisations either voluntarily or due to provision of law. It aims at improving the work life and social status of the employees.

The objectives of labour welfare are as follows:

1. To provide better work life, personal and social life and health to the labour force.

2. To make the workers happy and satisfied with the work environment.

3. Dissatisfaction regarding work life among the workforce creates industrial conflict and dispute. Labour welfare aims at minimizing industrial dispute and industrial conflict.

4. To increase production by increasing efficiency.

5. To provide better physical work environment.

6. To improve the standard of living of the workers.

7. Labour welfare programme aims at helping the labourers to overcome problems like absenteeism, increased turnover, indebtedness, alcoholism, etc., which make the labourer both physically and psychologically weak.

Labour Welfare – 5 Basic Features

The basic features of labour welfare measures are as follows:

1. Labour welfare includes various facilities, services and amenities provided to workers for improving their health, efficiency, economic betterment and social status.

2. Welfare measures are in addition to regular wages and other economic benefits available to workers due to legal provisions and collective bargaining.

3. Labour welfare schemes are flexible and ever-changing. New welfare measures are added to the existing ones from time to time.

4. Welfare measures may be introduced by the employers, government, employees or by any social or charitable agency.

5. The purpose of labour welfare is to bring about the development of the whole personality of the workers to make a better workforce.

The very logic behind providing welfare schemes is to create efficient, healthy, loyal and satisfied labour force for the organization. The purpose of providing such facilities is to make their work life better and also to raise their standard of living.

Labour Welfare – Importance of Labour Welfare Services

The basic objective of labour welfare is to make personal, social and work life of the workers good and satisfying.

The importance of labour welfare services are as follows:

1. Improving worker’s health – Labour welfare provides healthcare benefits, security against work hazards. Different welfare facilities provide better physical and mental health of the workers.

2. Increase in efficiency – Different welfare programme creates a better workplace and improves the physical and mental health of the workers enabling them to improve their performance and efficiency.

3. Reduction in labour turnover – Labour welfare programme provides satisfaction to the workers. Satisfied workers are more enthusiastic at work. This reduces labour turnover and absenteeism.

4. Improving employee’s morale – Labour welfare programme makes the worker feel that they are important asset of the organisation and are looked after. This improves the morale of the employees.

5. Promotion of industrial peace – Welfare services helps to maintain industrial peace .It avoids conflict with trade unions relating to issues like unhealthy work environment, accidents at work place, hazardous working conditions and so on.

6. Providing satisfaction to workers – Welfare facilities like housing, medical benefits, education and recreation facilities for the worker’s and their families help to create contented workers. Health and safety measures, improvement in working conditions, prevention of accidents creates satisfaction among the workers.

7. Reducing social evils – Improvement in material, intellectual, social and cultural conditions of worker’s life protect workers from social evils like drinking, gambling etc.

8. Relieve from personal worries – Labour welfare programme secures the personal and social life of the workers. Welfare facilities benefit the life of the workers as well as their families. Hence workers are relieved of their personal and family worries.

Labour Welfare – Top 10 Principles

The various principles of labour welfare are as follows:

Principle # 1. Adequacy of Wages:

High wage alone cannot create a healthy and desirable working environment in an organization. A combination of adequate wages, welfare activities and the right working environment is essential for job satisfaction of employees in an organization.

Principle # 2. Social Responsibility:

The organization or the industry in which the employees are being employed have the responsibility and obligation in terms of taking care of the well-being and welfare of the employees.

Principle # 3. Efficiency:

Organizations should perceive that by contributing to employee welfare they can motivate their employees, which can also contribute to enhance the efficiency of the employees as well as that of the entire organization.

Principle # 4. Re-Personalization:

This emphasizes the development of human personality as the principal objective welfare activities in the organization.

Principle # 5. Totality of Welfare:

The need and the importance of employee welfare must be felt and practiced at all levels of the organization.

Principle # 6. Integration and Coordination:

Coordinated approach is crucial in order to achieve a successful welfare program for the organization. At the same time care should be taken so as to integrate all the subsystems of the organization along with the fundamental welfare initiatives taken by the organization.

Principle # 7. Participation:

For the success of any welfare initiatives in an organization it is essential for employee participation from all levels of the organization.

Principle # 8. Responsibility:

For the success of any welfare initiatives both the employer as well as the employees should be mutually responsible. The trade unions should also take the responsibility of emphasizing upon labour welfare initiatives rather than focusing on their vested political interests.

Principle # 9. Accountability:

Management of any organization should be critical with respect to the accountability of labour welfare initiatives taken by them. The management representative should be given the authority to take necessary decisions in order to ensure accountability of the welfare activities.

Principle # 10. Timeliness:

Employee welfare measures must be provided on a timely basis as and when required on a priority basis, otherwise this could lead to decrease the effectiveness of the HR function in terms of increased cost and wastage. In this regard the management of any organization should emphasize upon proper planning and control.

Labour Welfare – Different Labour Welfare Measures 

Labour welfare measures can be classified into Economic service, recreational service and facilitative services.

Measure # 1. Economic Services:

Economic services mean provision of some additional economic security over and above wages or salaries like pension, life insurance, medical insurance, credit facilities etc. Provision of family pension to the family members of the employee in case of his death, payment of life insurance and medical insurance premium on behalf of employee, loans employees to be repaid by the employees in the form of monthly instalments to be deducted from their salaries provide economic security to employees.

Measure # 2. Recreational Services:

Management may provide recreational facilities reading rooms, libraries, TV’s provision for indoor games like Table Tennis, Carrom etc., to the employees. This relieves the worker from boredom and monotonous jobs.

Measure # 3. Facilitative Services:

Other facilities provided by the employers are the following:

i. Housing Facilities:

Some organisations construct houses/flats for the employees and provide the same to them either free of cost or at nominal rents while others provide house rent allowances to the employees, so that they can get houses on rental basis. Some organisations provide loans to the employees at concessional rates to enable them to construct their own houses/flats.

ii. Medical Facilities:

Organisations provide free health check-up, first aid facilities medical schemes which provide for the reimbursement of actual medical expenditure incurred by the employees. Large organisations also have their own dispensaries or hospitals for providing medical facilities to the employees.

iii. Education:

The National Commission on Labour and the committee on labour welfare recommended provision of educational facilities to the worker and running schools for children of the workers organizations may give education allowance for the children to the employees or reimburse the educational expenditure of the children of the employees.

iv. Transportation:

Organisations provide proper transport facilities to the employees to and from the factory. This facility helps in reducing strain and absenteeism. Sometimes, if the employers do not provide transport facilities, they give conveyance allowance to the employees. The employers sometimes give interest free or concessional loans to employees for the purchase of vehicles.

Labour Welfare – 7 Important Theories

On the basis of studies on labour-management relations and evolution of the concept of labour welfare, some important theories are developed.

These theories are:

1. The Policing Theory of Labour Welfare.

2. The Religious Theory of Labour Welfare.

3. The Philanthropic Theory of Labour Welfare.

4. The Paternalistic Theory of Labour Welfare.

5. The Placating Theory of Labour Welfare.

6. The Public Relations Theory of Labour Welfare.

7. Functional Theory of Labour Welfare.

1. The Policing Theory:

This theory assumes that man is full of self-interest. He will try to prosper at the cost of others. The factory and other workplace provide sufficient environment and opportunity for owners to exploit the workers. This can be observed in the form of long hours of work, low wages, unhygienic working conditions, neglect of provisions of health and safety, etc.

Thus continuous check on employers’ attitude by inspecting staff in respect of various legislation and periodical supervision as well as punishment to employers in case of disobedience of legal requirements are some of outcomes of the policing theory of labour welfare. The advantage of the theory is protection of labour against exploitation by management. But the disadvantage is that legal protection may not work with the spirit of welfare.

2. Religious Theory:

All the major religions like Hinduism, Islam, Christianity Parse, etc., believe in theory of karma of dharma in one way or the other. Rebirth or second life, (life after death) is an assumed phenomenon. It is also believed that the present disabilities in a man are the outcome of his karma. If a person suffers from leprosy, heart disease, economic crisis, blindness, etc., it may be that his deeds in this life or past life are responsible for it.

Merits and Demerits:

Welfare work done on the basis of personal benefits may lead to selfish motive. At the same time welfare work done without legal government compulsion at the sweet will of management has its own values. At least workers are benefited and management does an act to further the interest of workers.

3. The Philanthropic Theory:

This theory has its origin in Greek philosophy. ‘Philos’ in Greek means loving and ‘anthropos’ means man. Philanthropic means loving mankind. Human beings have natural feelings for the sufferings of other human beings. On the basis of this ideology, management people introduce welfare programmes like medical, educational and others for the welfare of workers.

Advantages and Disadvantages of the Philanthropic Theory:

It lead towards welfare of worker of workers. It is instinctive, natural and voluntary. But philanthropic sentiments may not be universal and continues one.

4. Paternalistic of Trusteeship Theory:

According to this theory employer is a trustee of this industrial estate and trustee of workers interest too. Workers are illiterate and poor; so by force of circumstance they need somebody as caretaker and employer is the best choice. The theory has moral conviction. The role of employer is that of an elder member in the family industry.

Merits and Demerits:

People who believe in religion might accept this theory. Whereas trusteeship idea has a moral base, but morality is related to values which differ from person-to-person and society-to-society.

5. The Placating Theory:

Workers are gradually becoming conscious of their rights and privileges. The worker’s demands for higher wages. Better working atmosphere and better status come out of their awareness and unity. Workers can be pleased by signs of grace like welfare and recreational programmes. Just as a crying child can be consoled by sweet, workers can be pacified by welfare measures.

Merits and Demerits:

Workers can be pleased by welfare amenities but they cannot be equated with children as they are matured, grown up human beings who may be illiterate but not immature.

6. Public Relations Theory:

Workers are part and parcel of society. They also form a significant part of general public. Administration of welfare activities aim to earn goodwill between labour and management Welfare programmes creating the need of larger public also include workers’ welfare.

For example, sport activities or charitable hospital in the name of the company provides welfare to the public including workers and other needy groups. It earns goodwill of the public and creates favourable image of the company in the eyes of the public.

Merits and Demerits:

In an ambition to acquire high public opinion, company might introduce welfare programme which satisfy its ego. But company may neglect really useful welfare activities which may not be valued by people in general.

7. The Functional Theory/Efficiency Theory:

Workers are the heart of industry. It is the man who operates the machine, shapes the raw material, prepares it and even sells it. If workers’ physical, social and psychological needs are satisfied they will work more efficiently. Welfare work aims at securing, preserving and increasing the efficiency of workers. Maintenance and development of human resources leads to efficiency and productivity.


Any theory which leads to productive efficiency is accepted by the management. On the whole productivity and efficiency is acceptable to nation as a whole. Productivity and efficiency are acceptable to workers and unions and earns higher wages. Even customers accept efficiency as they get qualitative goods at reasonable prices. Thus theory is acceptable to many groups concerned with the industry.


Welfare programmes are used for the selfish motives of employers. Of course efficiency and productivity are welcome by both employers and employees.

Above-mentioned theories have different approaches to labour welfare. Different employers make different types of approaches. Even more than one or all the approaches are made at a time. The scope and utility of labour welfare is fully exhaustive, leading to overall development of the labour community. Concept of welfare grows and develops with development of die nation and industrial development at large.

Labour Welfare – Schemes: Statutory Welfare Schemes and Non Statutory Labour Welfare Schemes

Different schemes of labour welfare are explained as under:

A. Statutory Welfare Schemes:

1. Drinking Water- At all the working places including dock areas, safe hygienic drinking water points are provided.

2. Latrines and Urinals- A sufficient number of latrines and urinals must be provided in a neat and clean condition.

3. Spittoons- In every work place, such as ware houses, store places, in the dock area and office premises where employees/workers are deployed, spittoons are provided in convenient places and same are maintained in a hygienic condition.

4. Lighting- At all the working places in the dock area, sufficient lights are provided for working safely during the night shift.

5. Ventilation- For the circulation of fresh air, and maintaining the normal temperatures sufficient number of ventilators are provided in dock area, where workers are required to work in three shifts, such as ware houses, and office premises in dock area.

6. 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.

7. First-aid appliances and Ambulance room- Adequate first-aid boxes are provided on the working places in the dock area & port premises and same are accessible. First-aid treatments are readily available during the working hours to the workers at the working places and the ambulance is also provided with the full equipment and qualified nursing staff.

8. Changing rooms- Adequate changing rooms are provided to the male and female workers separately to change their cloth in the dock area and office premises. Adequate lockers are also provided to the workers to keep their cloth and belongings, etc.

9. Rest rooms- Adequate no. of rest rooms are provided in the dock area to the workers with provisions of drinking water, wash basins, toilets, bathrooms, etc. for those who are working in the night shift.

10. Canteens- The canteens are provided in the dock area and other places of working for giving nutritious valued food to the dock workers

11. Hospital/Medical facility- Apart from medical officers, the hospital is enriched with qualified and experienced nursing personnel and other paramedical staff.

B. Non Statutory Labour Welfare Schemes:

(i) Educational facilities

(ii) Recreation facilities

(iii) Transport facilities

(iv) Family planning

(v) Comparative credit societies

(vi) Consumers comparative stores and fair price shop

(vii) Distress relief and cash benefits

Labour Welfare – Merits and Demerits

Relating to term labour welfare people has different two opinions. Same expert say the labour welfare involves high cast. All cost companies cannot afford for labour welfare facilities. Companies with low financial position find difficult to allocate funds for welfare activities.

Whereas large and profit making companies like Tata, Reliance, and public sector units are spending a huge amount on welfare of their employees. It may be a controversial issue whether to spend or not to spend on welfare of employees.

But following are merits of labour welfare:

(a) Provides facilities for workers.

(b) Makes the working condition comfortable.

(c) Hardships and tension of employees are taken care of.

(d) Contributes in saving of employees indirectly.

(e) Living standard of employees improves.

(f) Contribute in improving and maintaining health of employees and their family members.

(g) Develops a sense of belongings, commitment, and cooperation.

(h) Provides solution of many labour problems life absenteeism, richness and unrest

(i) Quality and quantity of production improves.

(j) Leads to progress of employees, employers, society and the whole nation.

Demerits of labour welfare:

1. The concept of labour welfare implies “do- gooding”.

2. Welfare is provided by the state services, hence the concept of it in private organizations might seem to be a duplication of the same which already exists.

3. Organizations might perceive labour welfare in a way that the private affairs of the employees and their off-the-job interests should not be the concern of their employers.