How to Develop Nonprofit Personnel Policies

Personnel policies and procedures outline how a nonprofit organization relates to its employees. They’re essential for both supervisors and employees because they provide guidelines about what’s expected in the workplace and on the job. They lay out expectations for employees, ensure that all employees receive equal treatment, and provide the steps necessary for disciplinary action if it’s needed.

Many start-up and small organizations that have only one or two full-time employees give personnel policies a low priority. Begin early to formalize your rules with an employee handbook. Doing so really doesn’t take much time, and it can save you headaches down the road.

You must follow federal and state labor laws when establishing personnel policies. The U.S. Department of Labor website contains the latest information. If you’re uncertain about whether you can require certain behavior or work hours from your employees, consult an attorney.

When forming policies, begin with the easy stuff: Decide on your organization’s office hours, holidays, vacation policy, and other basic necessities.

Determine work and off time

Most organizations follow the lead of others when setting holiday and vacation policies: Although you find a lot of variation, many nonprofits in the United States grant two weeks’ vacation per year to new employees. Employees typically receive more vacation time after a longer period of service, such as three weeks after three years, and four weeks after five to eight years.

The most common sick-leave policy is ten days per year. While you’re at it, you want to give some thought to bereavement and maternity/paternity-leave policies.

Paid vacation time is a benefit to both employees and employers. Employees return from vacation rested and ready to give their best efforts to the organization. For this reason, you should encourage people to take vacations during the year in which they earn the vacation. Most organizations and businesses don’t allow employees to accrue vacation time beyond a certain amount.

This policy ensures that employees use vacations for the purpose for which they’re intended. Such a policy also limits the need to make large cash payments for unused vacation time when employees resign or are terminated.

Consider reviewing the personnel policies of other nonprofit organizations in your area. A few telephone calls to other executive directors may help answer questions that arise as you refine your policies. Community Resource Exchange has sample personnel policies in its Tools for Nonprofits section.

Cover other important items

In addition to vacations and holidays, you should cover these other basics in your personnel policies:

  • A statement that the board of directors may change the policies.

  • A statement of nondiscrimination in employment, usually presented as a policy established by the board of directors — especially important if your organization is seeking government grants or contracts — and other policies established by the board.

  • A statement of procedures to encourage and protect employees and volunteers if they report wrongdoing — a whistle-blower policy. The National Council of Nonprofits provides guidance in this area.

  • A statement about parental leave and long-term disability policies.

  • A statement of hiring procedures and the probationary period.

  • A statement of the employment termination policy, including a grievance procedure.

Many organizations also include a statement of the organization’s mission and values and a brief outline of its history.

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