Improving Benefits at Small Groups: Tips From Charity Experts

Nonprofit employers, recruiters, consultants, and benefits experts suggest the following

to small charities that hope to bolster their benefits packages:

Ask employees what they want. Many organizations conduct annual or biennial employee surveys to determine what benefits their employees desire, and sometimes those responses influence employer policy. Two years ago, Girl Scouts of the USA, in New York, began revamping its benefits in response to employee requests for flexibility, says the Scouts’ national director of human resources, Michael Watson. The organization combined its vacation, personal, and sick days into a single “paid time off” plan and now offers employees a credit of $500 per year with which to purchase benefit options tailored to their needs.

Don’t make assumptions about employees’ needs, advises C. Dennis Riggs, president of the Community Foundation of Louisville, in Kentucky. “I’m 59, and I’ve got 30- and 40-somethings working with me, and they’re at a stage of life that I’ve already passed through,” Mr. Riggs says. “I don’t mean to say that I haven’t swallowed deeply sometimes, but I try to see their point of view. We’re here to personify the charitable impulse and philanthropy. We try to err on the side of giving people what they need.”

Seek advice from other local nonprofit groups. Talking to other nonprofit managers may help charity leaders learn how to manage benefits in their own organizations, suggests Susan Egmont, principal of Egmont Associates, a recruiting company in Norwell, Mass. Charity managers may learn that their organizations can afford more benefits than they previously thought. She suggests considering benefits that are relatively low cost, such as long-term disability and life insurance, which may be seen as gestures of employer good will. Domestic-partner benefits may be no more expensive than covering any other a spouse or child, depending on the insurance carrier and a charity’s location, and might be especially attractive to workers in large cities, who are more likely to have domestic partners than workers in smaller, more socially traditional regions.

Local standards should be part of any calculation of benefits or salaries, Ms. Egmont says. She recently had a nonprofit client who offered a job that remained vacant because no candidate would accept the charity’s policy of only offering two weeks of vacation a year. “Three weeks is the standard,” she says, “at least in the Boston area.”

Such data can provide strong evidence to bolster a nonprofit manager’s case when negotiating with his or her board, says Carrie H. Freeman, executive director of the Southern Chester County Day Care Association, a nonprofit child-care center for low-income families in Avondale, Pa. Three years ago, as she planned to approach her trustees with a request to increase pay and benefits for employees, Ms. Freeman says, she surveyed local employers, including for-profit day-care centers and a McDonald’s restaurant. Her employees got their raises and benefits, she says, partly because of how the organization compared with McDonald’s: “If that didn’t rattle my board, nothing did.”

Look for benefits that require a small contribution from the employer. Some benefits can be provided by merely covering administrative costs, says Jerome L. Mattern, chairman of the compensation and benefits committee for the Society for Human Resource Management. These offerings may include medical and dependent-care flexible spending accounts, which allow employees to put pretax dollars into accounts that can be used to cover medical and dependent-care costs, and 403 (b) accounts, retirement plans offered by tax-exempt organizations that are built with contributions from employees and sometimes supplemented by contributions from employers. Mr. Mattern, who oversees personnel issues at Quebecor World, a printing company in St. Cloud, Minn., recommends registering with Web sites like YouDecide.com, which offer members’ employees opportunities to buy house, car, or other insurance coverage at discounted rates.

Consider unusual benefits. Think creatively about nontraditional, low-cost perks that might help employees balance home and work more successfully. For example, says Ms. Egmont, a nonprofit client of hers offers employees a one-time allowance of $750 each to update their technology at home.

Join a group. Small organizations may find that their insurance-purchasing options increase if they join with a larger group, says Thomas W. Mesaros, vice chairman of the Alford Group, a national management and fund-raising consulting company that specializes in nonprofit organizations. He recommends contacting local United Ways or chambers of commerce, which usually provide their members with access to insurance at a discount. He also suggests finding a consultant who does pro bono work for small clients.

Take stock of available resources. Consider whether services provided to a charity’s clients could also be offered to employees, says Bonnie Shelor, vice president of human resources for the Bon Secours Richmond Health System, in Virginia. Bon Secours has repeatedly been lauded by Working Mother magazine for its rich array of benefits. Its employees may use many services that are part of the organization’s mission, including on-site bereavement counseling and the Family Center, a child-care facility that over its 13 years of operation has added programs for teenagers and adults too. Bon Secours built its benefits package gradually, and Ms. Shelor suggests that small charities can do the same by starting with benefits like health insurance and adding elements that relate to the group’s mission.

Prepare to negotiate with both trustees and workers. Board members may balk initially at using a charity’s funds to improve employee benefits, but don’t assume that all such discussions will end up in battles. Nonprofit leaders may find surprisingly sympathetic ears among their trustees. Generally, board members come from the business world, and they are aware of what is needed in the current job market to attract and keep employees, says Shelly Chenoweth, executive director of Youth Entrepreneurs of Kansas, in Wichita.

If an organization is in a penny-pinching mode, Mr. Mesaros says, a manager should consider negotiating with employees. He says that employers might, for example, offer workers smaller annual raises in exchange for increases in time off or other benefits.

Focus on showing employees they are respected. Keep in mind that employers need not always spring for the entire cost of providing a new benefit, but might share it with employees or offer the benefit as an optional perk. “It sends a message that the organization understands that you have a life,” Ms. Egmont says. “It shows that the organization respects you as an individual.”

Share your ideas for ways that small charities can expand their employee benefits on the Job Market online forum.