The following post was written by Standards for Excellence Licensed Consultant Elizabeth Galaida and is part of our “Ten Years of Advancing Excellence” blog series, celebrating ten years of the Standards for Excellence Licensed Consultant program. Elizabeth Galaida is a career nonprofit specialist that offers strategic planning assistance and database renovation. Bringing the necessary depth and breadth of skills sets to bear, she specializes in helping small to mid-sized nonprofits grow and thrive. Elizabeth became a Standards for Excellence Licensed Consultant in 2014. 

In a famous passage from Mark Twain’s classic novel Tom Sawyer, Tom convinces a friend that his chore of whitewashing the fence is cause for envy. His friend begs, “Say, Tom, let me whitewash a little.” This friend offers Tom an apple core in exchange for a turn with the paintbrush, but Tom insists that the job is worth the entire shiny red apple. The friend accepts. Tom spends the afternoon offering one friend after another the “privilege” of doing his whitewashing for him, accepting in return a miscellany of objects of value only to a boy, including a kite, twelve marbles, a tin soldier, a key that doesn’t unlock anything, and “a dead rat and a string to swing it with.” 

Though you may not have offered a dead rat for the privilege of working at your nonprofit, you have likely agreed to a lower salary than your peers in for-profit industries earn. You are not alone, however. For years, nonprofits have struggled to compete against for-profits for top talent. 

The culture of philanthropy posits that highly paid employees are antithetical to a nonprofit’s mission. The Huffington Post published an article about the most “insanely overpaid” nonprofit executives, none of whom can hold a candle to the top corporate CEO’s of, for example, a health insurance company or high tech firm. Yet, if nonprofits do not want to suffer the financial cost of high turnover and worker burnout, nonprofits need to examine their compensation and benefits very closely. Nonprofits can and should make themselves attractive to bright, talented people. Here’s how:

1. Be transparent and fair in setting wages. The Standards for Excellence states,“The board should…set the executive’s compensation; An organization’s human resource policies should address both paid employees and volunteers and should be fair, establish clear expectations…” The organization must publicly report in their IRS Form 990 the process they used to set executive compensation.The Standards also require that, “The organization has a procedure for setting and reviewing compensation for its employees; This procedure includes some comparative element (vertically within the organization, horizontally within the industry, or generally in relation to the economy); The board has reviewed the compensation structure for the organization.”Several reputable organizations conduct sector-wide compensation surveys to make this easier, such as GuideStar, the Association of Fundraising Professionals, Charity Navigator and NonProfit Times, among others
2. While you may not have the budget to match for-profit salaries dollar for dollar, it behooves an organization to compare salaries for comparable positions in the corporate sector. You should be aware of the degree of sacrifice you’re potentially asking your employees to make. Be sure to recognize your employees’ good works frequently, so they know their sacrifices are appreciated.
3. Offer work-life balance—Determine the reasonable workload that an employee can do within the time allotted, and then accept these limits of what can be done with the people you have. Offer flexible hours and telecommuting where possible. Millennials in particular value owning their private time over the advancement potential of an around-the-clock work environment.
4. Create a healthy work environment that enhances job satisfaction—Studies show that employees who are engaged, curious, have interesting tasks, and who feel their contributions are valued by their peers enjoy high job satisfaction. Poor job satisfaction, some research shows, is actually tied to poor health.
5. Connect employees to the mission—It’s easy for a case manager to understand how they are making a difference; you should find ways for the office manager, the development professional, and the maintenance worker to feel engaged with the mission, too.
6. Support professional development—Paying for an employee’s professional membership and educational sessions shows employees they are valued and helps them build their careers. The nonprofit sector is facing a leadership deficit in coming years. Invest in your people now.

Just remember: no matter how many intangibles you can offer, “good feelings don’t pay the rent,” and talented people have a choice of where they want to work. You might convince them it is worthwhile to whitewash your fence…or they will take their dead rat on a string somewhere else.[fusion_text]

Resources

The Nonprofit Sector’s Leadership Deficit, The Bridgespan Group Employee Job Satisfaction and Engagement: Optimizing Organizational Culture for Success, Society for Human Resource Management