News & Articles
Nonprofit senior managers are engaged in an elaborate game of musical chairs, with 44 percent of C-suite positions filled during the past two years taken by members of other organizations. Internal promotions have resulted in just 29 percent of new hires, half the rate of the for-profit sector.
In the Governing Body and Management section of the annual federal Form 990, managers at tax-exempt organizations are asked to address the following question: Did the organization become aware during the year of a significant diversion of the organization’s assets?
More than 7 out of 10 people see themselves as more generous than average but more people (59 percent) think donating time makes a bigger impact than donating money (41 percent).
America’s Thrift Stores reported a malware-driven cyberattack through a third-party vendor that might have compromised credit card numbers and expiration dates of transactions made last month at its 18 stores.
Most fundraisers (68 percent) use four or more channels to engage constituents, and the most popular engagement channels are email (86 percent), website (72 percent) and in-person events (71 percent) and direct mail (68 percent).
Fundraising abuse is the most common area of enforcement but state charity offices have not caught up to Internet or social media fundraising while staffing has remained stable since the Great Recession.
Everyone is born with the ability to negotiate, slowly losing the skill as they grow older, according to Jed R. Mandel of Chicago Law Partners, LLC. Anything is negotiable and one cannot get what they want without asking. “Your kids understand that,” Mandel told attendees of the 2015 Risk Summit during his workshop, “All That Jazz: Everything You Wanted To Know About Contracts But Were Afraid To Ask.”
During his presentation Mandel emphasized the importance of putting deals in writing, understanding the organizational authority of the party one is speaking with and framing negotiations such as employment contracts in comparison to what is, not what is being requested. The nonprofit-focused lawyer also provided considerations for six common elements of contracts:
• Termination. Contracts should have some sort of timeline spelled out, whether it is a specific date or when a project is completed. If a contract is defined by the completion of a project, how complete is defined should be agreed upon by both parties, Mandel said. Force majeure, the improbability or impracticality of executing a contract under unforeseen circumstances should also be considered, Mandel said. For example, a fire or airline shutdown could impact a contract between an organization and convention center.
• Indemnification. It is not unusual for one party to indemnify, or secure from legal responsibility, the other in a contract in the event of wrongdoing by the former. It is important, however, to only indemnify the other party in the case of one’s own wrongdoing, Mandel said. At times, should agreeing over indemnifications become too complicated, it is not necessary to include them in a contract, Mandel said.
• Restrictive covenants. Non-competing restrictions are more enforceable with reasonable, set terms, Mandel said. Indefinitely preventing a past employee from working in a similar role for another organization anywhere in a given region is not enforceable. Stating in a contract that the employee many not seek similar work for six or 12 months after leaving or within 30 miles of the organization’s headquarters is more realistic, Mandel said.
• Predicting the future. Placing agreements to agree in contracts is “dreadful,” according to Mandel. Instead, consider basing yet-to-be-resolved issues such as cost by definable means such as the rate of inflation or the Consumer Price Index. When drafting a contract consider set measurables that will define whether or not you are satisfied with how a contract is being met. Without defined measurables, it is difficult to illustrate a breach, Mandel said.
• Intellectual property. Be careful how your name and logo are used. If you own your own trademark, be mindful of how you limit its use with others in contracts, specify each way it can be used and do the same when entering into a contract in which you will be using another party’s trademark. Be mindful of who owns copyrights to certain materials. If an organization brings on a third party to design a promotional piece, the third party owns the copyright unless he or she signs a work made for hire agreement with the organization, Mandel said. Organizations own, within reasonable limits, work created by employees, but it may be wise to put specifications in employee manuals to avoid gray areas, Mandel advised.
• Dispute resolution. In the event of a disagreement, there is value in setting the rules and venue in the contract, Mandel said. In the case of two parties from different states entering into a contract, a party may wish to define which state’s law would apply in the event of a disagreement and where legal proceedings would take place, Mandel said. NPT
Shut Up And Listen
It’s exhausting but you have to do it
Associating Not High
On List For Some
State, Regional Groups
The Virginia Network of Nonprofit Organizations (VANNO) launched in 2004 to provide a voice for the state’s nonprofit community. By 2012, it was gone.
Tragedy has struck twice at fundraising events during the past month, resulting in the deaths of two volunteers, highlighting that special event risk extends beyond staff to fundraisers and volunteers who might not have a direct connection to an organization.
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November 1, 2015Table Of Contents
Vol. 29, No. 13
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