“Fringe” benefits are those monetary and non-monetary benefits that are given to the employees during and post-employment period, and are connected with employment but not with the employee’s contribution to the organization. As indicated earlier, “fringe” (Le., minor or short) is misnomer nowadays. In the past, employee benefits and services were an exception in some organizations, and they were small in number and volume. However, now they make up such a large part of the total compensation package that the term “fringe” is no longer appropriate. However, the term “supplementary benefits” is still commonly used to refer to this aspect of employee compensation. Thus, it may be noted that “fringe” as the term is commonly used for them.
In fact, benefits have become something other than the once thought of “fringe”. Employees expect certain extras to be the ‘norm’ rather than the ‘exception’. Careful of these requirements and the competition from other employers, management has to develop costeffective methods to offer these benefits.
The term ‘fringe benefit’’ covers bonus, social security measures, retirement benefits like provident fund, gratuity, pension, workmen’s compensation, housing, medical, canteen, cooperative credit, consumer stores, educational facilities, recreational facilities financial advice and so on. Thus, fringe benefits cover a number of employee services and facilities provided by an employer to his employees and in some cases to their family members also. Welfare of employee and his family members is an effective advertising and also a method of buying the gratitude and loyalty of employees. But, while some employers provide these services over and above the legal requirements to make effective use of their work force, some restrict themselves to those benefits which are legally required.
