Definition

• An employee welfare program is a benefit that will cost the employer money, be provided by another source or be free. What is important is that the employee welfare program adds to the employee's personal and professional life. Also, at least some employees must assign value to the employer's welfare programs, or these programs will not really relate to their individual welfare.
  
  

Financial Security Programs

• It is difficult to imagine what is meant by this broad term. You might think of programs such as compensating employees and offering group health benefits. Some programs contribute to an employee's financial security by providing monetary support when there is a change in an employee's work status, and these may be required by law. Employees who become involuntarily unemployed can apply for unemployment benefits in the U.S. In each state, workers who are injured or become sick at work might be entitled to medical benefits and other compensation through a workers' compensation program. Their families could be entitled to benefits when workers are killed on the job.
  
  

Professional Development

• These programs help employees believe they are valued by the organization. An organization provides some benefits directly to employees, such as extra training, mentoring and workplace programs that help employees build skills and abilities. Employers can also pay for professional development for employees outside the organization, either upfront or through employee reimbursement.
  
  

Pay Structures

• Ever since organizations have standardized employee pay structures, they have begun to experiment with schemes for giving extra compensation, which directly improves an employee's welfare. For example, an employer might use a pay-for-performance system in which the employees with the best performance evaluations get a bonus or raise. Or an employer might consider other factors, such as extra compensation for contributing innovative ideas or length of service.