The Meaning Of Employee Benefits Program

1. Employee Performance

Performance is the achievement or ability of a person who in terms of reliability, initiative, innovation, thoroughness, work, presence, attitude, cooperation, tidiness, quality of work, etc. It is influenced by objectives, performance is the impact of motivation or enthusiasm and ability to be able to complete a task or job, a person must have a degree of willingness and a certain level of ability (Sastera et al., 2018). Employee performance is the successful completion of task, responsibilities or assignment by selected employee or group of employees based on a set of performance objective and indicator of efficiency and effective utilization of available resources. Besides, employee performance can be seen as an activity in which the individual can achieved the task assigned to them successfully, subject to the usual constraint of the reasonable use of available resources. Employee performance is the achievement of set of standards in terms of accuracy and completeness over a specified period of time (Kadir et al., 2019). Employee performance or job performance in other words, is defined as individuals’ behaviors regarding self-control and those affecting achievement of organizational goals (Dhammika, 2013).

Employee performance is a very critical factor in every organization. It is the basis of the success of an organization which, in all aspects, is dependent on individual employee performance. In other words, if an individual performs according to the expected standards, then organization performance will be enhanced and improved. It is, therefore, logical that employee performance is an extremely important criterion that relates to organizational outcomes and success. It is, therefore, logical that employee performance is an extremely important criterion that relates to organizational outcomes and success. Given the importance of employee performance, management has to carry out an in-depth analysis of their employees and find out the determinant factors that will increase high employee job performance (Zirra et al., 2019).

Employee performance is actually influenced by motivation because if employees are motivated then they will do work with more effort and by which performance will ultimately improve. In many organizations, awareness on employee is a very important role in maintaining and creating commitment of all employees for best performance and a best performance will give satisfaction. Performance is the result of work that has strong relationship with organizational strategic goals, consumer satisfaction and economic contribution (Sastera et al., 2018). Employee performance is highly depending on how the company's strategy is made and conducts it continuously in the effort to create and increase the performance itself (Ramadhany et al., 2013). Job performance is a very significant factor affecting profitability of an organization (Jayaweera, 2015).

Some approaches to measure employees performance that have achieved as follows: Quality, degree of results of activities already done to meet perfect; Quantity, amount of the result already had; Timeliness, degree of duration of working to meet target already set; Effectiveness, degree of use of an organization's human; Independence, the degree to which an employee can perform his or her job function without assistance (Sastera et al. 2018).

Hence, from some of the opinions above, it can be concluded that the performance of employees is the level of implementation of work as obligation of employees to achieve both in quality and quantity of work in order to meet standards set by company.

2. Employee Benefits Program

Employee benefits programs are usually created by the company to increase the employee's ability to lead a sustainable living so the employee feel comfort in working. The fundamental goal of employee benefits programs is to improve the lives of employees and add happiness. Employee benefits programs can be as 'wise investments' that will generate profits in the form of greater efficiency (Choudhary, 2017).

Some opinions stated on employee benefits programs can be described as follows. Employee benefits programs can be interpreted as an effort to make life more appropriate for workers. These efforts are based on the law or some things on the needs of employees in accordance with their daily lives (Vetrivel, 2016). Employee Benefit Program is part of an additional remuneration system in the form of cash of various types, may be in the form of insurance, services to employees, benefits of old age or some expenses incurred outside of work.

The benefits program is an award given to the employee not only as an employee. Usually this award is not due to employee performance. Sometimes it is given due to the status or grade of employee, service and employment period of the employee. Benefits programs are divided into 3 basic groups, namely: Benefits programs for social needs such as pension funds, life insurance, business loans, child care; Benefits programs for work needs such as eating, drinking, sports, worship; Benefits programs related to employee positions such as company cars, job allowances, entertainment money (Sastera et al., 2018). The provision of benefits programs is not based on the performance of employees but based on the status of a person as an employee or member of the organization itself that aims to improve his personal needs to be able to lead a better quality of life (Ramadhany et al., 2013).

Benefits program is a company's effort to provide the best facilities to all employees that impact on sense of happiness and can improve the quality and quantity also productivity. So, the increasing of employee ciliates will be happy and the level of performance increases and company profitability will increase (Sastera et al., 2018). Employee benefits program is one of the forms of compensation provided by the company as a form of policy that is complementary to the salary received in material or non-material. While the purpose is to improve the physical and mental quality of employees who will be able to increase work productivity (Ramadhany et al., 2013).

The conclusion of some of the above stated opinions is that the employee benefits program is an additional benefit that employees get in addition to the salary received. These benefit programs are obtained by employees due to their position or grade as a member of the organization. The purpose of providing welfare programs to employees is to improve their standard of living or quality of life or to increase their comfort. The benefits provided can be in the form of money, facilities (physical or non-physical) and in the form of services provided to the employee itself or to the employee’s family.

3. Types of Employee Benefits Program

In general, employee benefits programs provided by an organization or company can be different. This difference can be influenced by the type of company business, the corporate culture itself, the geographical position of the company, the social environment of the company, and most importantly in accordance with the ability and objectives of the company in case to provide benefits programs.

Employee benefits or welfare programs are divided into two parts: legal welfare programs and welfare programs that are discretional. Welfare programs that are legal include social safe guards, while welfare programs include: health benefits, retirement benefits, unemployment benefits, promotions, awards, educational benefits. And in general, the welfare program is also divided into the financial and nonfinancial benefit (Sastera et al., 2018).

Economic welfare programs are generally in the form of money, given for the purpose of providing protection or security and guarantee to employees economically. The background of this policy given is because in this world, there really is no eternal and uncertain or like a mystery. The benefit is expected to be utilized if any burden condition or unwanted condition. So that the protection or economic security is a good thing for employees and can create peace (Ramadhany et al., 2013).

The advantages of welfare facilities are to provide physical and intellectual fitness for employees, increase awareness of work to increase productivity, companies gain strength with energic employees to reach careers and contributing to the company, encouraging employees to work efficiently and creating a comfortable working environment (Ramya et al., 2016).

4. Relation of Employee Benefits Program with Employee Performance

Benefits programs provided to employees that have the intent to maintain and to improve the physical and mental condition of employees in the hope to increased productivity of work (Ramadhany et al., 2013). Improvement of the physical and mental conditions will stimulate the morale of work that affects the growing sense of responsibility of employees and the obligation to complete the job well. The company strives to pay more attention on employees than to pay the salary, the company has considered several benefit packages to boost the morale or motivation of employee (Stalmašeková et al., 2017).

Employee benefit aims to maintain high morale and employee motivation so it can keep for longer duration, creating comfortable working conditions and creating harmonious working relationships between employers and employees (Reenu & Panwar, 2013). Lack of or inadequate benefit package to the employees limits the social and organizational conditions of workers and impact on their productivity. It could impact also on the team morale which limits the firm's ability to provide an overarching normative or moral framework within which workplace change might unfold, leaving team systems vulnerable to anomic tendencies, to status distinctions among hourly employees, and to other sources of instability (Odeku, 2014).

Employee satisfaction has remained a remarkable area of discussion in the field of management, psychology and especially in organizational behavior and human resource management. It is extremely necessary for the management to look into the welfare and well-being of their employees such as looking into the monetary and non-monetary rewards. Organizational rewards system and employees’ satisfaction is seen as an interrelated component in an organization. Organizational rewards are known to help an organization boost the employees’ motivation thus leading to employees’ satisfaction. If the company can implement employee benefit program very well, it can make employee morale higher and better. It is clear that given employee benefits program will affect employee morale. So that corporate goals can be achieved in accordance with that has been established (Sastera et al., 2018).

Employee morale is one important thing to have a maximum employee performance. There are some opinions about relation of positive employee morale with positive employee performance. Employee morale within an organization has a direct impact on the satisfaction level of its customers and the company's ultimate success. Employees are considered the most important resources, and the winning card in the hands of management (Wantania & Lapian, 2015).

Low productivity may be traceable to poor employee motivation. The success and effectiveness of any firm depend to a large extent, on how well employees are motivated. Theories of human resource management, as well as theories of motivation, suggest that motivated employees tend to be more creative and productive, and it is wise for any management to use these theories in order to increase productivity and competitiveness. Employee performance is actually influenced by motivation because if employees are motivated then they will do work with more effort and by which performance will ultimately (Sastera et al., 2018)


1. Ramadhany, M., Habsji, T. A., & Mukzam, M. D. (2013). Pengaruh Program Kesejahteraan Karyawan Terhadap Semangat Kerja Karyawan Dan Prestasi Kerja Karyawan (Studi Pada Karyawan Tetap Kompartemen SDM PT. Petrokimia Gresik). Jurnal Administrasi Bisnis, 2(2), 127-136.

2. Dhammika, K. A. S. (2013). Measuring Employees’ Performance in the Public Sector in Sri Lanka: Testing of Two Models.

3. Zirra, C. T. O. P., & Anyatonwu, P. Impact of Fringe Benefits on Employee Performance: A Study of Nasco Group, Jos Plateau State.

4. Choudhary, S. (2017). Employee welfarAscheme of wise investment. International Journal of Advanced Education and Research. ISSN: 2455-5746, Impact Factor: RJIF 5.34. 2 (1); www. alleducationjournal. com, 01-06.

5. Vetrivel, S. C. (2016). A Study on Satisfaction of Employees Towards the Organisation’s Welfare Measures. Apeejay-Journal of Management Sciences and Technology, ISSN-2347-5005, 3 (3), 13-17.

6. Stalmašeková, N., Genzorová, T., & Čorejová, T. (2017, September). Employee Benefits as One of Factors of Work Motivation. In CBU International Conference Proceedings (Vol. 5, pp. 448-452).

7. Ramya,T. J., et al (2016). A Study on Employee Welfare Facilities and Its Impact on Employee Satisfaction at Hotel Industry with Special Special Reference to Mysuru District. International Journal of Engineering Science and Computing, 6(12),3680-3683.

8. Reenu, M., & Panwar, J. S. (2013). Current trends in employee welfare schemes in Udaipur Retial Sector. International Jour. of Scientific Research Review (IJSRR), 2(2), 45-54.

9. Odeku, O. F., & Odeku, K. O. (2014). In pursuit of the employees’ welfare in the workplace: issues in perspectives. Mediterranean Journal of Social Sciences, 5(15), 652-652.

10. Wantania, Y. I., & Lapian, S. L. J. (2015). THE EFFECT OF EMPLOYEE MORALE AND FACILITIES TOWARD EMPLOYEE EFFICIENCY OF PT ASTRA INTERNATIONAL TBK–DAIHATSU MANADO. Jurnal EMBA: Jurnal Riset Ekonomi, Manajemen, Bisnis dan Akuntansi, 3(3).

11. Sastera, B., & Mauludin, H. (2018). The Influence of Employee Benefits Programs on Employee Morale and Employee Performance in Pt. Cji Pasuruan. International Journal of Business and Management Invention (IJBMI), 7(5).

12. Kadir, A. A., AlHosani, A. A. H. H., & Fadillah Ismail, N. (2019). The Effect of Compensation and Benefits Towards Employee Performance.

13. Jayaweera, T. (2015). Impact of work environmental factors on job performance, mediating role of work motivation: A study of hotel sector in England. International journal of business and management, 10(3), 271.

29 April 2022
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