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Employee Benefits For Nonprofit Organizations

Satisfy Federal And State Benefits Requirements

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The Affordable Care Act employer mandate requires organizations, including nonprofits, with 50 or more full-time equivalent employees to provide health insurance that meets minimum essential coverage .

Other laws require employers with 50 or more employees to provide family and medical leave to employees who have been employed for at least a year. Youll need to ensure your organization remains compliant with the law while offering benefits your employees value.

A Streamlined Benefits Process

When offering benefits, small nonprofit HR departments may have difficulty sorting through and evaluating all of the alternatives. Further, if they don’t have large staff rosters, they may not be able to obtain benefit coverage at competitive prices. They may be forced to piece together various options from different vendors, which can become quite a headache to manage.

For example, a nonprofit might have a benefits provider that offers two inexpensive healthcare insurance plans, a second benefits provider that offers life insurance coverage, and a third that provides dental and vision coverage. Having three separate benefits providers increases the amount of administrative work HR must perform. If not managed properly, multiple providers can create confusion for employees as well.

A PEO provides a one-stop shop for employees and HR for benefits. The PEO manages carrier relationships and negotiations and makes all options available to clients and their employees through an ESS portal. And the PEO can help provide employees with the appropriate information about each benefit option so that employees can make the right decision for themselves and their families.

What Are The Benefits Of Working At A Nonprofit

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Having a healthy paycheck is important, but for many people, the work they do is about more than the bottom line. You want a career you feel passionate about. You want to support others in your community. You want to work to build a better, more inclusive world.

If any of these things are important to you, you may want to consider a career in the nonprofit world. Here are a few of the benefits of working for a nonprofit.

Contribute to the greater good

When you work a corporate job, your work is about supporting the bottom line. Monster.com states, Whereas increasing profit is the bottom line in more corporate settings, at nonprofits, the goal is to advocate for and advance a certain cause. When you work for a nonprofit, your work furthers an organizations mission, whether that is advocating for the environment, building houses for low-income families or supporting individuals and families with disabilities. In other words, your job directly supports your community and the people who live in it.

Access to competitive benefits

Explore different roles

Opportunities for creativity and innovation

Work within a supportive, mission-based culture

Create more equitable communities

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Nonprofit Job Seeking 101 First It Always Best To Know What The Challenges Are And What You Get Out Of Seeking A Job At A Foundation/nonprofit

Nonprofits, foundations, and educational institutions are attractive to work at because they are mission-driven and they offer a do-good feeling from working at them. Being able to work, accomplish real results and feel like you are making an impact is very rewarding. More so:

Another Big Benefit Are The People In The Sector.

Get To Know Your Employees Personally

Affiliate Membership

Every team member should be valued as a person, not just as employee #239. Spend time with your workers to get to know who they really are. Phone systems for nonprofit organizations offer many team collaboration tools for virtual communication. However, spending time with them in person is even more valuable because body language and other subtle nuisances get lost in video and voice communication. In person, you can communicate with greater effectiveness to show interest and build trust.

Here are some fun ways to create opportunities to get to know your team:

  • Hold happy hours, lunches, and other non-work outings.

  • Start your Monday meetings by recapping your weekends.

  • Spend time working alongside them instead of staying in your office.

Finally, make use of the information you learn about them. For example, if you are sending them a gift card, make it for a store that you know they like. Or, plan company outings based on a hobby that everyone shares. Remember, a little bit of caring can build a lot of loyalty.

Anthony is ready to implement these strategies!

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Will An Hsa Work With My Existing Employee Benefits Package

A Health Spending Account is a cost-effective and flexible addition to a business’ group benefits. It is a modern health and dental care benefit which offers flexibility and cost-effectiveness that most traditional insurance providers typically dont have. This type of benefits package is particularly useful for small nonprofits because it offers a budget friendly and proactive approach to your benefits. It can even work in conjunction with traditional health insurance, by covering any missed coverage. Additionally, premiums paid to an insurance provider are eligible for tax deduction through a Health Spending Account.

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How Justworks Helps Nonprofits

Justworks is a PEO that helps small- and medium-sized businesses attain access to enterprise-level benefits for their teams. Justworks also helps your company administer payroll and with certain governmental and compliance forms.

Many nonprofits are Justworks members, and we even offer a nonprofit discount. Learn more about Justworks and our features to see how its a great fit for nonprofits.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.

Justworks helps businesses with their benefits, payroll, and everything else they need to take care of their team.

Retain Your Best Employees

health insurance for nonprofit employees.

Employees that feel valued are more likely to stick around, even when times are tough. Having experienced, trustworthy employees helps ensure efficiency, productivity, and effective training for new staff and employees.

Oliver loves having his health insurance benefits offered through work!

Offering a benefits package sets the example that you are willing to go above and beyond mandatory requirements to take care of your people.

It also speaks well of your organization when you have a large staff of tenured workers. While this is not always in your control, when it happens it means you are doing something right. Once again, this establishes your nonprofit as the place to be in the nonprofit sector and is a positive reflection of your agency.

Pro Tip: When planning insurance benefits, do not forget to take into account your hard-working officers. Reward their burden of leadership by considering quality insurance for your nonprofit board of directors. When these leaders feel valued, they work harder and stick around too, the same as any other employee.

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Tax Advantages Of Offering Employee Benefits

The benefits that a nonprofit organization offers could be the deciding factor in whether a qualified candidate chooses to accept the job or turn to a different organization. However, nonprofits must be careful not to overextend their budget when choosing fringe benefits. Some of the offered perks will not only benefit employees, but also the employer. It is important to understand these tax advantages before deciding which options are best suited for the organization.

Some IRS-qualified employee health plans can provide nonprofit organizations with tax advantages. For health insurance coverage to be tax-deductible, the business must meet specific criteria established by the IRS.

Starting January 1, 2015, organizations with 50 or more full-time employees are required to provide affordable health care coverage as part of an employer shared-responsibility mandate covered under the Affordable Care Act . To qualify, a business must pay for at least 50 percent of their employeeâs health care coverage costs and the annual wage paid must be below $50,000. Companies with fewer than 50 workers can purchase a health plan through a state or federal insurance exchange.

Life insurance premiums paid out by businesses are also considered tax-deductible business expenses if the insured on the policy are officers or employees within the organization. Tax laws also dictate that the organization cannot be a direct or indirect beneficiary of the policy for it to be tax deductible.

Varied Responsibilities Can Help With Career Advancement

Joining a nonprofit out of college will often mean more responsibility earlier in your career, says Tasia Duske, CEO of Museum Hack. By working for organizations that tend to have lean budgets and staff, you could potentially dive in to taking on important tasks early in your careerand that experience can be a huge plus.

Obviously experience and exposure to certain job duties are a boost to your resume as you advance in your career, but dont overlook the value of learning more about what youre not suited for. Maybe youre excellent at keeping a budget in line but not so great at event coordination. Learning this may have been a little painful, but potentially having a chance to try your hand at or assist with multiple types of work can help you put your plans for the future in focus.

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Attention Small Nonprofits: If You Care About Your Employees Help Them Retire

Those that are attracted to the nonprofit sector tend to be a caring bunch. They are often paid under-market wages and work long hours, justified by the meaning we derive from our work and the good we are doing in the world. However, as much as we care, we ironically perpetuate inequality for those employed to do this good work. One key aspect of this phenomenon is how little grassroots nonprofits support employees in saving for retirement.

Although being without retirement savings takes longer to show its impact than more immediate benefits such as health insurance, saving for retirement is crucially important for well-being. The ability to work is a form of capital, often the most significant asset a person controls. In this way, for those who can work and are not wealthy, not saving is not simply missing an opportunity to build assets, but an actual reduction in ones financial position. As one ages, ones ability to work decreases. If this is not replaced with savings, ones financial position is reduced.

When nonprofits do not offer retirement savings, they make it more difficult for employees to eventually stop working when necessitated by age, illness, or other reasons . The important work of nonprofit employees ought to be rewarded with the ability to retire with dignity after a career of service.

All parties need to come together to create this reality.

What Health Insurance Can You Offer To Your Employees

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Budgeting is often tight for nonprofits, so it is important to find a plan that offers useful benefits while keeping your bottom line intact. Fortunately, there are several options at your disposal.

Here are some programs that make for great starting points when beginning your preliminary research into health insurance packages.

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First What Is A Nonprofit

Youre probably familiar with the term, but you might not know the specifics of what a nonprofit organization actually is. Just like the name suggests, nonprofits dont exist to earn a profit. Instead, they raise money to fulfill a purpose related to charity, education, science, literacy and others, as defined by the IRS. If a nonprofit adheres to all the necessary IRS tax laws, they can be recognized as a 501 tax-exempt organization.

Just because these organizations arent interested in turning a profit doesnt mean they all lack resources and must skimp on employee pay to get by. Nonprofits can be incredibly successful organizations with in-demand products and services. In addition to those potential revenue sources, nonprofits often raise funds through grants and donors, social media campaigns, events and other fundraisers.

After covering operating costs , nonprofits ensure their remaining revenue goes toward whatever their cause is, be it fighting childhood cancer, caring for the homeless, providing healthcare services or preserving wildlife.

Great Nonprofits Offer Benefits That Employees Love

Although its likely that most nonprofits cannot pay as well as private companies or large government agencies, they often make up for it by providing excellent benefits. Great nonprofits don’t skimp on benefits. They make every effort to be competitive with the private sector and even go beyond what is expected.

They often offer some combination of the following:

  • Retirement plans such as 401 and 403
  • Tuition reimbursement
  • Onsite fitness facilities or help with memberships at outside facilities on-site weight loss classes walking clubs free blood screenings and flu shots.
  • Healthcare insurance
  • Flexible scheduling of work hours opportunities to work from home carpooling services
  • Family care time off
  • Short and long-term disability programs
  • Generous vacation time
  • Bonuses that can be added to salary or used for professional resources.

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The Challenges Of Seeking Nonprofit Jobs:

Finding the position you are right for and sticking with it. If you can choose a position that you are interested and stick with it you will always be employed.

  • Story: many people feel and say, wow I would be great at event fundraising, but if they get the opportunity only stay in the department for two to three years on average.
  • This is the same for Grant Writers, why are they so in demand? This is because most people do not stay in these roles for long as W2 staff. Once they learn the trade most move up into larger roles or choose to leave staff positions so they can instead consult as an experienced grant writing professionals.
  • The key is to find a position/area you are right for and sticking with it.
  • This is the key to your professional success and it is also your hardest decision.
  • Dont attempt to switch employment from development to programs unless you have specific experience or volunteer experience in the area. Or try to go from operations to marketing, or finance to programs or another large change without planning. These leaps are very hard to pull off unless you first gain real and applicable experience volunteering or working.
  • If you are senior level and are not working in it now, join a board or nonprofit committee. You can then get the right experience that will make nonprofit decision makers confident in your background.

Choosing and sticking to a general area of interest and overall mission or niche within the nonprofit sector.

Nonprofit Salaries And Compensation

Employee Benefit Plan Basics

So how do we define a good compensation package? Lets start with salary. At the least, all nonprofits must pay their employees the state or federal minimum wage. To maintain your tax-exempt status, the upper end of your pay scale must be reasonable and not excessive.

That should help you determine the upper and lower end of your employee salaries. But it doesnt tell you exactly how much to pay. The best way to determine a good salary range for your employees is to research your competitors. What is the going rate? How much do other nonprofits pay their employees for similar jobs in your area?

The National Council of Nonprofits maintains a database of state nonprofit associations. Most of these groups conduct periodic surveys of nonprofits in their states. They may collect nonprofit salary and compensation data.

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Benefits Of Offering Employee Benefits

There are many good reasons to sponsor employee benefits. First and foremost, as a non-profit your employees spend their days supporting others wouldnt it be nice to support them?

It also makes good business sense to support employees with benefits. Employee benefits help improve the mental and physical health of employees. This can mean something as simple as filling a prescription filled unsurprisingly it is not uncommon for people without coverage to choose not to fill a prescription. Suppose that prescription helped prevent a negative health event from occurring? Or suppose an employee decides to get an eye exam and that eye exam identifies an underlying health condition? In these instances, preventative measures improve the health of employees. This translates into fewer sick days, less presenteeism and higher productivity.

Hiring Any Employee Triggers A Host Of Legal Requirements From Filing With The State To Report A New Hire To Determining The Appropriate Compensation To Calculating Withholdings From Compensation For Tax Purposes

This page does not attempt to cover all these issues, but rather to validate how important it is to compensate employees fairly and debunk the myth that “nonprofits only have volunteers.”

We also want to encourage those managing nonprofits with employees to recognize that nonprofits compete with for-profit workplaces for talented workers, so setting the right level of compensation can make the difference between attracting and retaining qualified employees or, in contrast, suffering from high turnover and/or not being able to retain talented employees. While it’s another myth that “good benefits make up for low compensation,” generous benefits are definitely an important factor in hiring and retaining employees.

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What Benefits Do Great Nonprofit’s Offer

Some leaders wonder what types of employee benefits packages should be offered in nonprofit organizations. In many cases, the problem is not only what, but at what expense and how do you prioritize?

There are some scenarios in which nonprofit organizations are evaluating the options that they have in this regard. Keep in mind that there are several ways to go about this process, and its important to understand your options.

Today, we will give you the 101 on the value of offering great employee benefits in your nonprofit.

The importance of benefits for your employees

If you are running a nonprofit organization, it makes perfect sense that your organization aims to provide the best possible work environment for all employees. A nonprofit’s core focus is to help, uplift, and support people when they are in need.

Your employees are the heart of your organization, and you want to make sure that you can keep them as happy as possible. If you have a talented workforce, you want to do everything you can to keep them with you, and this is a good way to contribute to that cause.

You have to consider several things before you choose your provider. Some of the main things to keep in mind include the objectives of the nonprofit and the budget. These are all factors that will play a major role in how you decide to approach this process.

The direct purchase option

The Small Business Health Options Program

The broker option

The PEO option

The ACA and healthcare benefits

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