Stop Paying For Office Space. Invest In Your Employees’ Retirement Instead.

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Reddit has announced plans to offer its staff the opportunity to work remotely beyond the pandemic, and it won’t cut salaries for employees who leave the Bay Area for more affordable cities, unlike Facebook, for example, which has said that it will adjust employees’ salaries based on their locations—are the pros and cons of adjusting salary based on locale? And for the social sector – how should our commitment to equity, inclusion and justice influence our response?

Non-profits are facing difficult decisions as they navigate the economic toll of COVID19.

In communities all over the country, working-class and poor families are facing urgent increased needs for food security, housing, healthcare, and safety. Direct service organizations surveyed by the Center for Effective Philanthropy this summer reported a 55% increase in demand for services. While foundation giving has increased in some areas, organizations more reliant on major donors have seen a precipitous 43% decline in philanthropic revenue from donors giving $7,500+ annually.  Major donor revenue tends to be less restricted and enables organizations to cover core general operating expenses such as employee benefits (including retirement), professional development, office space, and pre-COVID19, travel. 

At the end of September 2020, The Non-profit Times reported that the total non-profit workforce had dropped by 7.6% since pre-March 2020 levels. With COVID19 numbers hitting new peaks in the United States every day, political leaders are anticipating new lockdowns and additional economic stress.

When making decisions in this destabilized and unpredictable resource environment – it pays to return to your values.

During The Obama Foundation’s Summer 2020 Reimagining Policing Town Hall, moderator Brittany N. Packnett Cunningham began the conversation with one of the most powerful reminders I’ve heard in years. “A budget is a moral document.”

And now is a good time to return to those morals. While the non-profit sector offers strategic, committed, and inspired professionals opportunities to impact the issues that matter to them – it is wildly understood that salary potential is significantly higher in the private sector. Often leaving non-profit employees unable to prioritize their future economic security.

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How might we seize these economic decisions as opportunities to commit to our values as a sector?

There’s an interesting statistic  in the May 2020 Non-Profit HR Coronavirus Pulse Survey that states, “..(69%) respondent organizations are now contemplating remote work as a longer-term option beyond the novel coronavirus crisis.”  Rather than realizing these savings in their entirety, consider how you can ensure the long term wellbeing of your organization’s biggest investment – your talent.

Organizational commitments to equity, inclusion and justice must extend beyond staff & board composition – to the financial and personal stability of those employed. So what are leaders to do? Commit to:

  1. Performing an updated organizational pay equity assessment
  2. Analyzing the data to inform compensation adjustment decisions for employees able to and interested in relocation
  3. Ensuring equitable incentive structures include increases in retirement contributions and matches for employees at every level

And be prepared to invest in the digital and virtual culture infrastructure needed to thrive in this new environment. Whether providing standing desks, increased cell phone & wifi reimbursements, or child care stipends, your employees deserve transparency, respect, and commitment.

It’s unlikely that this year’s disruptions are over — now is the perfect time to ensure that the rainy day funds for your employees are a priority.  They invest in your mission – and you should continue to invest in them.