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June 24, 2015
Partner With the Center

A small number of Corporate Sponsor roles remain for the 2015 Risk Summit, this September 20-22 at the Hard Rock Chicago Hotel. Corporate Sponsors enjoy pre-event publicity, exclusive access to limited booth space in the conference expo, and prominent recognition throughout the event. To discuss the cost and benefits of Corporate Sponsor status and to inquire about one of the remaining opportunities, contact Melanie Herman at 703.777.3504 or Melanie@nonprofitrisk.org.

Put the 'Human' Back in HR: 6 Bold Moves for 2015
By Melanie Lockwood Herman

Risks associated with the hiring and deployment of personnel inevitably crop up during Center-guided Risk Assessments for complex nonprofits. Mission-draining HR risks include a lack of meaningful teamwork and accountability; botched onboarding and chaotic departures; high rates of turnover due to dissatisfaction with supervision, compensation and benefits; and nonexistent performance management.


While many organizations choose to make small, incremental improvements in staffing policies rather than overhaul what clearly isn't working, at the Center we believe that nonprofit missions deserve a bold approach to fixing HR. We also believe that it's high time to humanize human resources. If your staffing and performance management functions aren't worthy of your ambitious mission, consider making one or more of the following six bold moves in 2015.

Take a Stride on the Wild Side: Provide Paid Family Leave - Follow in the formidable footsteps of TOMS Shoes founder and CEO Blake Mycoskie by establishing generous paid leave for all employees who are new parents. In a recent interview with Glamour Magazine, Mycoskie recalls learning that "only 12 percent of all American workers have access to formal paid parental leave, and the vast majority of men take off less than a week when their children are born." Instead of writing off paid family leave as a costly benefit your nonprofit cannot afford, think about the innumerable benefits of generous family leave. Consider whether a generous family leave policy might bring your nonprofit a few important steps closer to the values from which your mission was born.
Stop Making Snap Judgments: Defeat Interview Bias - Studies have shown that interviewers make up their mind about a prospective employee's suitability within the first 90 seconds of the interview. What is the rest of the interview for? Even seasoned interviewers are subject to first impression bias, and tend to spend their remaining time with an applicant looking and listening for information that validates their first impression. To defeat this powerful bias that takes root the minute you shake the applicant's hand, resolve to conduct pre-employment reference checks before you make eye contact with the top candidates for an open position. Stop using reference calls to confirm what the applicant told you. Instead, use reference checks to discover what people have to say after witnessing the applicant's work ethic and professional abilities. Interview only those applicants whose references reveal a trustworthy nature, strong work ethic, and excellent technical and soft skills.
Demand 100% Participation in the CEO's Performance Review - Contrary to the common view that the most important job of the board is fundraising, the most important role of any board of a nonprofit with paid staff is to select and supervise the organization's senior staff member, the CEO. Which is why I am both perplexed and dismayed to hear, from time to time, that the job of evaluating the CEO's performance has been delegated to an executive committee. Or worse--that board members who fail to participate are not held accountable for their inexcusable absence from the process. In a new twist, the Center was asked recently whether it was "ok" to append a single board member's glowing memo to the performance review conducted by the board as a whole. The simple but emphatic answer is "no." Permitting this practice conflicts with the important message that governance is a shared responsibility, and the views of any one member of the governing body must be considered as just that: the views of one member. 
Cross Train WIthout Delay - The lack of task and role cross-training in a nonprofit puts a charitable mission in needless jeopardy. Yet many otherwise savvy managers downplay the importance of cross training within their functional areas or departments. The unplanned departure of staff--for myriad reasons--is a simple inevitability in every workplace. Too often nonprofit leaders put off formal cross training until it becomes absolutely necessary, or even too late. To shorten the list of tasks and responsibilities for which cross training is a an absolute necessity, ask each staff member to highlight the responsibilities on their job descriptions that meet two criteria:
  • Tasks performed only by the employee; and
  • Assignments or tasks that could be curtailed for two to three months without any consequence to the effectiveness or fiscal health of the organization

Cross training for any roles that meet both criteria may be safely postponed until absolutely necessary. Roles that meet the first, but not the second criterion above should be targeted for cross training without delay.

Resolve to Pay Livable Wages - Facebook made the news in May 2015 when it announced a new policy requiring vendors and contractors to offer better benefits and a minimum wage of at least $15 per hour, more than twice the Federal minimum wage of $7.25. Facebook's move followed the announcement of Seattle-based credit-card processing firm Gravity raising its minimum wage to $70,000 a year. According to news reports, Gravity founder and CEO Dan Price "was inspired by cities around the country increasing their minimum wage and decided he'd like to take it a step further." Tax-exempt nonprofit employers differ from for-profits in several respects, including the fact that the net income of the organization may not "inure" to the benefit of a private individual, and the salaries of influential executives must be reasonable, not excessive. But an area where nonprofits need not differ from best-in-class private sector employers is the commitment to pay a livable wage and provide truly valued employee benefits. Resolve to make 2015 the year that your nonprofit rejects the tiresome canard that you simply can't afford to pay entry level staff a livable wage. Invite everyone on your team to identify practical and tangible ways to cut operating expenses to yield the savings needed to make this goal a reality and extend compassion to your compensation practices.
Ask Your Staff and You Shall Receive - One of the most common mistakes made by even experienced leaders is making decisions before asking staff to weigh in. Every member of your team should be valued--not just for what they produce--but for their ideas. A second common misstep is assuming you know what staff value in the workplace. Did you ask your team for their thoughts before adopting new policies pertaining to annual leave, dress code, office hours, or benefits? Most employers simply assume, rather than ask. In some cases you may need to make a decision that isn't popular. But high-performing, dedicated employees will respect you nonetheless and are more likely to support those decisions when they were part of the process. 

The Human Resources function in a nonprofit should be far more than a processing depot for incoming and outgoing employees. Ambitious charitable missions deserve bold moves that reaffirm the organization's humanity.

Melanie Herman is executive director of the Nonprofit Risk Management Center and welcomes your questions about managing HR risk or the Center's consulting services at 703.777.3504 or Melanie@nonprofitrisk.org.

NEW - Insurance Fundamentals Issue of RME

The Spring Edition of Risk Management Essentials is now available. The "Insurance Fundamentals Issue" addresses topics of interest and relevance to nonprofit leaders responsible for securing commercial insurance for their organizations. The features in this brand-new resource include:

To access the searchable, online, magazine-style version of RME, click here. To download a printable PDF of the newsletter, click here. To read the articles online, click here. The Center is deeply grateful to our RME advertisers: 501(c) Agencies Trust , Philadelphia Insurance Companies and Great American Insurance Group. The support of these advertisers, and our Corporate Sustainers, makes the publication of RME possible.

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