"Welfare" Becoming Problem

We are a part of a prestigious and very old industrial house that believes in employees' welfare from day one. One decade back, we started from a green field. At that time, to attract and retain employees, we introduced breakfast in the canteen and a transport bus from the neighboring town as our factory was in a remote area.

Initially, the scheme ran very well, but in the last few years, workers have come to assume that these are their rights, and the employer can't discontinue them. The excessive involvement of workers in both services is creating a nuisance, and significant efforts are being made to run both services smoothly.

What could be the repercussions if we spread the message to discontinue both services? Neither in the appointment letter nor in the standing order have we mentioned these facilities. Seniors, please guide on how to handle the situation as "Welfare is becoming Farewell" for HR people.

HR Prof.

Nothing should be given in a company for free, especially to employees. Whenever you want to introduce anything related to welfare, please do so in consultation with the employees who will benefit from the welfare scheme provided by the employer. If you try to stop the facility, employees will likely resent or oppose it. If this facility has been provided for a significant period, it has become part of the service conditions of their employment, so any changes to it must be implemented by issuing a notice under section 9A of the ID Act. It is advisable to consult with all employees and try to convince and negotiate with them to receive something in return for the free facility.

In the future, ensure that nothing is provided to employees in the name of welfare for free; always try to receive something in return related to discipline, productivity, or the quality of the company. Wishing you success. Please update and share with us your stance and the outcome of the same.

I don't think the ID act would be involved here if it is not part of any written offer. It would be better to make the services complimentary or charge a minor fee for older employees, say after 3 years of service, and start charging new employees on a no-profit-no-loss basis initially in the name of employee welfare.

You have clearly mentioned that your organization is a prestigious industrial house with a belief in employee welfare. You have also stated that this facility was introduced to attract people rather than as a welfare measure.

I think your organization is not interested in stopping these facilities. The issue seems to be 'EXCESS INVOLVEMENT OF WORKERS' in running these facilities rather than the cost. Cost could go up if there is excess involvement.

The fact that the organization is just 10 years old indicates that the average age might be around 28. When we talk about a group, we talk about four stages:

1. Forming
2. Storming
3. Norming
4. Performing

The same is applicable to any process to settle. I guess the organization must have formed some committees in the last two to three years to manage these facilities. It will go smoothly in the initial stage. You might be facing the Storming stage. If you can manage this stage well, which involves education, counseling, the issue will be resolved. The moment you look and address workers as "They" and the Management as "We," the gap widens.

Firmness and perseverance are the keys. Rigidity and impatience to be carefully avoided while managing the Storming stage.

Thank you for your input.

We are deducting 1/10 part of the cost from their salary, with the remaining amount being borne by the employer.

How can we streamline this process while ensuring genuine user involvement?

My views on facilities once given, and that too for a long period, cannot be withdrawn without justifying suitably. Welfare facilities are extended to the employees by the organization with a view to facilitate comfort for the employee, so that they can contribute better towards organizational goals.

As an HR professional, I understand your difficulties but would like to suggest taking sufficient time to implement decisions that may bring negative thoughts to employees' minds, potentially affecting the organization's work progress. Even if withdrawing extended facilities does not violate any labor laws, the long-term effects on the organization's work progress always matter. Employees can be taken into confidence, counseled, and by forming a group, the desired option can be achieved.

Dear HR Professional,

Learned members like Mr. T. Sivasankaran have already provided valuable insights regarding the issue based on their practical wisdom. As a former conciliation officer with ample experience handling industrial disputes, including those stemming from seemingly minor issues such as poor food quality in the canteen or unprofessional behavior from canteen staff, I would like to share my perspective on this matter with the forum.

Why do managements initiate so-called 'welfare measures'? Is it to bridge the gap between 'real wages' and 'money wages' for workers out of compassion, or to enhance their mobility both within and outside the factory premises? Consider the fleet of buses operating in and around Sivakasi in the early hours, like the "KUTTY JAPAN" mobilizing labor from the vicinity. In the realm of business, especially in large-scale production and marketing, profit is vital. Maximizing profit involves prudent cost-cutting strategies, with labor costs being one of the most negotiable aspects.

Apart from the underlying motive of boosting productivity at all costs, welfare measures like canteen services and transportation facilities are introduced and maintained to gain a competitive advantage in negotiations, as Sivasankaran astutely pointed out. So why complain that welfare is turning into farewell? When you mention 'excess worker involvement,' it's unclear what you mean precisely. Is it excessive utilization of canteen facilities at a 90% discount, leading to food wastage, or unauthorized use of transportation by boarding and alighting at unscheduled stops, or perhaps issues related to representation in the canteen committee?

Comparing workers to dogs by giving them excessive benefits is inappropriate. Workers possess innate intelligence and should not be underestimated. Engage in introspection and, as a conscientious HR professional, seek out effective solutions to address these challenges.

Best regards.

Dear All,

A few years back, I faced a similar situation where similar facilities were offered by management. However, later, a few destructive minds interfered with the arrangement to seek additional benefits. This eventually led to a worst-case scenario, akin to a wet blanket - something you can use but not discard, and too heavy to carry. At that point, I decided to discuss the issue with the chairman, and I would like to share his solution with all of you.

He explained that providing the facility comes with its own cost. If we were to stop it, there would be a different cost in the form of resistance, demotivation, and the strengthening of destructive minds that could harm the morale of sincere employees. Our problem was struggling to satisfy the employees, despite spending a significant amount of money.

His solution was to declare this as a hardship allowance, not on a monthly basis but calculated based on the days attended. Surprisingly, for each employee, this amounted to 365 days - 52 weekly offs - 30 leaves - 15 holidays, which totals to 265 days. By implementing this, we saved on setup costs and minimized wastage.

Moreover, this approach effectively neutralized the influence of destructive minds, which had been our major challenge.

Best regards, [Your Name]

Dear Sir,

To Mr. Umakanthan,

Thanks for sharing your wisdom. I am sure that as a senior person with a background of complete labor law compliance, experience in handling conflicts, and providing solutions, your suggestions are extremely valuable and implementable by organizations when disputes arise.

On the sidelines, I would like to share my insights about a section of the labor force, namely security guards, who are not considered as human beings in the majority of establishments, with a few exceptions. Although their presence is critical and important in guarding property, people, and assets 24 hours a day, 365 days a year, regardless of weather conditions. There are approximately 3 lakh direct workers employed in this unorganized sector, with a turnover of around 22,000 crores on an all-India basis. No laws or regulations protect them. There is no guarantee for their employment, job security, career advancement, wages, or holidays. Anyone can wear the cap, belt, and an ill-fitting uniform to portray the image of a guard, reflecting the high demand for this workforce in all locations. Their plight is pitiful, and their working conditions are among the most challenging. Despite this, the industry is growing at a rate of 20% per annum. In the midst of alarming security concerns and threats across all sections of society, this industry is not even regulated by any department. Laws like CAPSI are only followed on paper. I would appreciate hearing your views on this matter.

To Mr. Himanshu,

Please shed some more light on your process of arriving at a solution in your organization.

Regards,

V. Rangarajan

HR Consultant, MBA faculty, and Ph.D. Scholar -- Chennai.