Intellectual capital, in a knowledge-based economy, has become a major production factor that influences a company's economic prosperity. In the perspective of resource-based view theory, intellectual capital is a company's strategic resource to create value and increase competitive advantage. Further investigation is needed into the value chain between intellectual capital and employee welfare. This study aims to examine the effect of intellectual capital on employee welfare on the Indonesia textile industry by involving productivity (asset turnover) and profitability (return on assets) as intervening variables. The study was designed as an explanatory research on the Indonesian textile industry listed on the Indonesia Stock Exchange during the period 2020-2024. The measurement model of intellectual capital used is Value-Added Intellectual Capital (VAIC^TM), while employee benefits based on the rules of the Financial Accounting Standards Statement (PSAK) 24 concerning Employee Benefits by the Indonesian Accounting Association adopted from International Accounting Standards 19. Data analysis uses panel data regression with the OLS-common model approach. The research findings show a positive effect of human capital efficiency (HCE) and structural capital efficiency (SCE) on productivity; a positive effect of HCE, SCE, and productivity on profitability; and a positive effect of SCE and a negative effect of capital employed efficiency (CEE) and productivity on employee welfare. Productivity does not mediate the effect of HCE, SCE, and CEE on profitability and employee welfare. Likewise, profitability does not mediate the effect of HCE, SCE, CEE, and productivity on employee welfare. The empirical results indicate that intellectual capital in the Indonesian textile industry has not yet formed a complete value chain for employee welfare through productivity and profitability. The resulting value chain is only directly formed by SCE, but is still weakened by CEE.