Most nonprofits need General Liability insurance and Directors and Officers (D&O) insurance. If the organization has employees, workers compensation insurance, as well as other insurance offered to employees as benefits such as health, dental, and life insurance may be needed.More information on types of insurance relevant to nonprofits can be found below.Want access to resources on budgeting, financial policies, personnel policies, and risk management? Join the Standards for Excellence[…]

Reimbursement Policy An organization's policy should be to reimburse employees and volunteers for necessary and reasonable travel expenses incurred for authorized business. The intent of the policy should be that reimbursement is fair and equitable to both the traveler and the organization and consistent with federal regulations. Individuals traveling on business are responsible for complying with travel policies of the organization and should exercise the same care in incurring expenses as they[…]

Employers are not obliged to give severance pay. The law only requires an employer to give severance if it has been promised in a contract, or stated in an employee handbook, or if there is an established pattern of giving severance to other employees in similar circumstances.Some employers choose to offer severance pay to employees who are terminated, either involuntarily or voluntarily. The primary reasons for offering a severance package are to soften the blow of an involuntary termination[…]

All employers should expect their employees to meet established standards of attendance, performance, and conduct.If, after going through the performance appraisal process, employees cannot or will not improve their poor performance, the next resort for a manager is progressive discipline. In a progressive discipline system, the disciplinary measures range from mild to severe depending on the nature and frequency of the employee’s misconduct. An employee moves through the system like climbing a[…]

It is a good idea to have a formal orientation program so that all newly hired employees get the same treatment and information. This orientation period will probably last several weeks. You will want to be both welcoming to your new employee, and attentive to legal requirements.Elements of an employee orientation include: Personalize the workspace Orient the employee to the office: how equipment works, description of procedures, etc. Introduce the new employee to all the staff,[…]

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Employee – Black’s Law Dictionary describes an employee as “A person in the service of another under any contract of hire, express or implied, oral or written, where the employer has the power or right to control and direct the employee in the material details of how the work is to be performed." The IRS has developed a list of factors that indicate whether a worker is an employee. Some of them include: A person is required to comply with another person's instructions about when, where and[…]

An annual audit is an examination of an organization’s financial systems and transactions at the end of a year by an independent, certified, professional auditor. The audit assesses whether or not financial statements have been prepared in conformity with Generally Accepted Accounting Principles (GAAP) or Other Comprehensive Basis of Accounting commonly referred to as OCBOA. The audit is an assessment or professional judgment of the financial statements prepared by an organization’s management.[…]

Board members are responsible for understanding the financial condition of their organization in order to fulfill their fiduciary obligations. The IRS Life Cycle states that “Directors are stewards of a charity’s financial and other resources. The IRS encourages the board … to ensure … funds are appropriately accounted for by regularly receiving and reviewing up-to-date financial statements and any auditor’s letters or finance and audit committee reports.”Documents the board should receive[…]

Nonprofits enjoy the public’s trust, and therefore must comply with a diverse array of legal and regulatory requirements. Organizations should conduct periodic reviews to address regulatory and fiduciary concerns. One of leadership’s fundamental responsibilities is to ensure that the organization governs and operates in an ethical and legal manner. Fostering exemplary conduct is one of the most effective means of developing internal and external trust as well as preventing misconduct. Moreover,[…]