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HR Policies for Charities

hr policies for charities

HR policies can assist charities in remaining legally compliant, while providing a healthy and productive working environment for both staff and volunteers.

Any organization is bound to encounter conflict from time to time; having effective HR policies in place makes managing such situations much simpler.

1. Payroll

Payroll management for nonprofits is of utmost importance as employees are directly accountable for its finances. Not only are employees hard at work fulfilling the mission of their charity, but they also have bills to pay; therefore it’s critical that payroll be overseen accurately in accordance with applicable laws and regulations.

Nonprofits are accountable for both payroll and compliance with applicable labor laws that impact workers, such as overtime rules, meal time laws and paid time off policies. Furthermore, nonprofits must submit annual tax reports to the IRS in order to maintain their tax-exempt status.

An experienced HR professional can assist in creating an employee handbook to cover these essential guidelines for all of the team members to follow. An employee manual will ease onboarding process for new team members as they navigate the company and quickly locate answers to any potential queries that may arise in the future.

An HR specialist can also help your charity set policies and procedures for hiring, firing and disciplining employees as well as provide guidance regarding compliance issues such as worker classification (i.e. employee versus volunteer). Nonprofits that want to take their HR support a step further might consider working with an HR service provider who offers live HR support, proactive alerts and employee training solutions for all staff members.

2. Benefits

As with any business, nonprofits must offer fair pay to employees for their work. Nonprofits may use various incentives to keep staff happy and productive such as retirement plans, health insurance, or wellness programs; it’s important that these benefits be carefully considered in order to avoid overspending.

If nonprofit staffers work more than 40 hours each week, their organization may be required by state law or federal regulations to pay them overtime compensation. Any such policy should be communicated clearly to all staff members – paid and volunteer alike.

Your nonprofit might benefit from offering its employees various life insurance policies, such as participating whole life (PWL) and universal life policies, which provide lifelong coverage. PWL policies feature sufficient death benefits while universal life policies offer flexible cash value growth based on market conditions.

Nonprofits may want to consider adding charitable riders into existing permanent life insurance policies. These additions enable policy owners to donate a percentage of their death benefits directly to charity without cutting into their cash value or impacting existing cash value of the policy. Charitable riders are especially popular among donors looking for tax advantages from using assets for charity-related activities; consult with a broker who understands your mission before planning an appropriate charity-owned life insurance strategy.

3. Training

Training their staff efficiently and effectively is of utmost importance for charities, enabling them to complete their jobs efficiently and effectively. Employees should understand how to use any tools available and any regulations that pertain to them – having such policies in place helps everyone remain aligned, including trustees, volunteers and employees, while minimising risk.

Most professional advisors advise nonprofits to establish written guidance for their employees in the form of an employee handbook or manual, so as to maintain consistency in treatment between supervisors and staff, provide answers for frequently asked questions while decreasing answering times, and create clarity over organizational standards for staff members to abide by.

Nonprofits face special employee concerns that must be managed, including issues related to codes of conduct, flexible working or remote work arrangements and absence management. With robust policies in place to deal with such matters quickly, fairly and legally – for instance Ontario’s Working for Workers Act stipulates a written electronic monitoring policy as one requirement of employment; you can find a free template here.

4. Performance

An effective nonprofit requires clear and transparent HR policies, which give leaders a framework for dealing with employee concerns while mitigating risks and providing consistency.

Nonprofit HR policy can be an arduous task. Therefore, the board of directors should consult an outside resource on employment laws and practices or seek professional advice from an expert in this field. Oftentimes it would be prudent for a charity to obtain this expertise through its director and officer liability insurer who may offer educational materials or programs about managing employees effectively and creating appropriate personnel policies.

Expectations are essential to the success of any nonprofit, and should be clearly laid out in an employee handbook or job description. Furthermore, such documentation should outline specific goals and objectives against which success can be measured; this allows potential donors to see firsthand the impact of their donations, which aids their decision-making processes.

Establishing a procedure for supervisors to hold regular, constructive, and candid performance evaluations and discussions with their staff can also be useful in being proactive about addressing performance problems while creating an atmosphere of trust and openness in which staff can flourish. A nonprofit that struggles to effectively assess and manage its employees will struggle to fulfill its mission and reach its goals.

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