When I was 27, I was in a CPA firm where I was climbing the corporate ladder on track to be a partner. But, my life was wrapped up in achievements and promotions and the things I sought most seemed to be put on the sideline. That's when something shifted in me. My search for success became a search for significance. That change brought about a relocation and employment with a nonprofit. Well, money isn't everything, but it is something, and it does play a part in the employment decisions that people make.

     Nonprofits offer a unique opportunity where passion and purpose often converge. Conversations about compensation can sometimes be overshadowed by the drive for impact and then become the white elephant in the room. Fair compensation is not just a money matter, it's crucial to valuing the dedication and skills that your staff bring to their roles.

Why Fair Compensation is So Essential

Expertise and Professionalism

Nonprofit workers often bring a wealth of expertise and professionalism to their roles. Whether they're pastors, program managers, or outreach coordinators, these professionals have honed their skills through education and experience. Their ability to execute complex projects, manage budgets, and navigate bringing mission to reality is not only valuable, but it requires significant training and dedication.

Passion With a Price

      While it's true that many individuals are drawn to nonprofit work by passion and a desire to make a difference, that does not mean that their work is any less valuable or that they should be compensated less. The passion for a cause should not be equated with the willingness to accept lower wages. Fair compensation, however, reflects the value of the work done and respects the commitment of those who choose to work in the nonprofit sector.

Retaining Talent

     Fair wages are essential for retaining talented individuals in the nonprofit sector. High turnover can be costly, beyond the financial investment in recruiting and training. When staff is lost, institutional knowledge often goes out the window.

     I saw this happen in a nonprofit that I worked in when daycare workers were having massive turnover. As a result, the program was significantly impacted because the parents could feel the difference. Every time they turned around, there was a new teacher for their child. Those new teachers didn't always know everything they needed to know to make that classroom function effectively. Of course, the minimum standards were maintained, and I'm happy to say that no child was harmed, but the point is that we can more effectively accomplish our missions by reducing turnover and retaining talented staff. In the case of this nonprofit dedicated to serving children, that turnover was significantly impacting their mission and was an area they had to work on. By offering competitive salaries, nonprofits can retain skilled staff who are critical to achieving the mission and ensuring the long-term success of the programs.

Enhancing Organizational Impact

     A well compensated workforce is a motivated workforce. When staff feel valued and fairly compensated, they're more likely to be engaged and committed to their roles. Increased engagement can translate into more effective delivery of your programs, innovative solutions, and an overall stronger impact. Investing in staff compensation is an investment in your organization's success.

Attracting Skilled Professionals

      Attracting skilled professionals to the nonprofit sector requires competitive compensation. Nonprofits are often competing with the private sector and other organizations for top talent, so offering fair wages helps to level the playing field and ensure that nonprofits can attract and retain the best individuals to drive their missions forward. In other words, fair compensation is not a luxury, it's a necessity. Recognizing the value of nonprofit workers through fair wages is essential for both the employee’s wellbeing, but also for the organization to retain talent and enhance their impact.

How to Make Competitive Compensation a Reality in Your Nonprofit Organization

     As a steward of staffing in your organization, I want to inspire you from ideals to practical action! Here are some ways to create a culture of high value with employees in your organization:

Provide Competitive Compensation

• Salaries- Regardless of your budget, the top priority is definitely to optimize compensation in the form of fair salary. We want to ensure salaries are competitive with similar roles in the nonprofit sector.
•  Benefits- We want to offer the most comprehensive benefits package, including health insurance, retirement plans, and wellness programs.

Encourage work-Life Balance

• Flexible hours- Add value by offering remote work options and flexible schedules.
•   Paid Time Off- Provide ample vacation days and personal leave. Make it easy for your staff to take advantage of these benefits. Sometimes staff coverage can be complicated and even though paid time off is theoretically available, it can feel like it's not really a benefit.

Recognize and Celebrate Achievements

•  Public Acknowledgement- Regularly acknowledge your individuals and your teams as they make achievements, whether it's in meetings, emails, newsletters, or social media. Give them a shout out! It goes a long way when what you've done is seen and valued by others.
•  Awards and certificates- These can be another means of valuing and recognizing your team. Make them for notable accomplishments and share them with your staff.

Foster a Sense of Purpose

•   Make daily connections between the everyday work and the organization's mission.
•  Impact stories-  Share stories and data about how the organization's work is really making a difference and connect the dots that lead back to that employee's position. Emphasize how significant it is to fulfill your mission as a team.

     In closing, I want to share that we've created an incredible masterclass called The Financially Thriving Nonprofit. In this class, you'll learn how to create a culture of competitive compensation that retains talent. The degree to which your staff are compensated, satisfied, and committed directly impacts the ability of your organization to fulfill its mission. If you’re ready to master this crucial area of decision making, you can learn more here!