Should Nonprofit Employees Contribute Cash to the Cause?

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Eventually, this issue comes up at every nonprofit. Should employees be expected to support the mission of the organization through their own cash giving? My conclusion is an unequivocal “no.”

The idea to solicit employees is borne out of the belief that employees will want to financially support the organization’s cause. While the desire is almost always there, the reality is more complicated.

The Employment Relationship

Employment is a complex relationship, and it shouldn’t be distorted by other relationships, including family, friendship, love, borrowing, or cash giving. While the value of teamwork can’t be overstated, the most effective supervisors maintain an “arm’s length” connection to subordinates.  This means avoiding other entanglements.

Legally, employment is a “master-servant” relationship. Without getting into the philosophical debate about what fuels philanthropy, it’s easy to argue that there is an inherent conflict between a servant’s obligation and altruism.

Employees, by definition, commit their “work lives” to the mission of the organization. Yes, they are paid, and that is the “bargain” entered into by both employers and employees.  Any expectation that part of that payment should be funneled back to the employer — in most cases, after-tax — is counterintuitive.

Practical Ability to Give

For numerous reasons, nonprofit employees are often paid below market wages of the local private sector.  Asking employees to contribute part of their wages back to the organization is inequitable.  Even if employees consistently give (either because they are asked or because of peer pressure), this will be a breeding ground for resentment.

The Counterarguments

“We can’t ask donors to give if our own staff isn’t supporting us.”

This is a false equivalency. Your staff supports your organization every day with its blood, sweat, and tears. You need committed donors to fund the work. You need committed staff to get the job done. These are two very different roles.

“Our board members give. Our staff gives. It’s just part of our culture.”

The board relationship is different from the employment relationship. Board members are volunteers who make a commitment to the oversight and direction of a nonprofit. Not all board members have the same ability to provide financial support; however, the expectation to do so is typically a prerequisite commitment to board service. Conversely, I haven’t seen an organization ask for employee giving as part of the hiring process. I have seen it as part of the onboarding process, which has the potential to be an unwelcome surprise to a new employee.

“We have employees who can afford it and want to give.”

Provided it’s not solicited, it’s fine if a highly-compensated employee (e.g., an Executive Director) voluntarily donates to the organization. Still, it shouldn’t be publicized in a way that will make other employees feel an expectation to give.

Summary

When it comes to employee giving, my advice is simple — don’t ask.  If you’ve been asking, stop.  If anyone wants an explanation for why you’ve stopped, tell them you’ve rethought the issue, and you appreciate your staff’s work too much to ask them to do more than they already do. Do you see this issue in a different light?  Please share your thoughts.

 

Dan Weiss, founder and President of Counterpart CFO, leads a team of flexible, part-time CFO’s serving nonprofits and for-profit businesses. To read more from Dan, follow him on LinkedIn or subscribe to his blog at www.counterpartCFO.com.

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