4 HR Mistakes Nonprofits Make

If you work for a nonprofit, you’re probably familiar with the concept of wearing many different hats for your job – whether it’s development, accounting, human resources, or all of the above. But no matter how hard you try, HR mistakes are bound to happen. It’s just the nature of the beast (a very, very regulated beast).

These mistakes can be costly if you’re not careful; think compliance penalties, litigation, unemployment costs and employee replacement costs. We’ve listed some of the most common mistakes so you can try to avoid them at your nonprofit.

1. Bad Hiring Decisions

In the nonprofit world, you’re likely to know just about everyone who works in the same circle. So it makes sense that to offer a job to someone you know, right? Well sometimes skipping the interviewing step means you’re missing out on the most qualified candidate, and missing important information. Interviews, background checks and references are absolutely a must when it comes to hiring the right person. The wrong person for a position can be costly, since you may have to pay unemployment if you have to replace them, and the cost in both time and money to find a replacement quickly adds up.

2. Not Documenting Infractions

It’s not easy addressing performance or company policy concerns with an employee. Although it can be uncomfortable, it’s much more uncomfortable to have to address these issues in an unemployment claim appeal hearing when you try to prove the employee was discharged for cause. The first steps are having clear performance expectations in your job descriptions as well as an employee handbook outlining organizational policies. Then create a performance review to discuss any concerns with an employee, and address the steps they can take to improve. And any infractions must be documented in writing, including:
 

• Date of infraction
• Details of infraction
• Explanation of corrective actions needed
• Statement of next disciplinary steps
• Signature of the employee

Finally, don’t wait to have the conversation! It’s easiest to provide immediate feedback and point to a distinct occurrence rather than try to explain later on “Remember that one time…” Do it now, and you’ll thank yourself later.

3. Not Knowing Basic HR Rules

If you don’t have someone with acute knowledge of the laws around the following HR laws, make sure you get acquainted with the rules or have a certified HR professional to help you:
 

• Discrimination
• Overtime and minimum wage requirement
• Family medical leave and Military leave
• Unemployment
• Age and gender discrimination
• Disability
• Safety in the workplace
• Pregnancy discrimination
•  Immigration

Ignoring these laws can lead to costly legal concerns and thousands of dollars wasted. Download the 36 Critical HR Processes, and learn more about UST’s live hotline with SPHR and PHR certified HR professionals.

4. Not Knowing the Difference Between Contracted, Volunteer, Part-Time, and Full-Time Employees

The U.S. DOL has strict rules around Independent Contractors and Volunteers. Not only do you need to be aware of the rules around pay and benefits, you should know who is eligible to collect unemployment benefits. Independent contractors may file for unemployment, and you need to be able to prove he or she is not an employee of your company.

Here at UST we know it’s not easy managing the most important part of your organization: your human capital. Having the right employees can make or break your mission, and so can following the proper HR procedures. Interested in learning more about our tools for nonprofits? Find out about Unemployment Claims Administration and our HR Hotline.