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Unique Challenges Faced By Nonprofit HR Teams

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Nonprofits face many of the same challenges that for-profit businesses face when managing staff. However, some human resources issues are unique to nonprofits due to the limitations on time, money, and resources.

We’ve identified three challenges and ways to help you address them.

Recruitment and Retention

Limited resources, coupled with an overtaxed or non-existent HR staff, means that nonprofits have a particularly hard time attracting and retaining quality talent.

According to Nonprofit HR’s 2017 Nonprofit Employment Practices Survey, more than a quarter of nonprofits (28%) reported that “hiring” is the biggest staffing challenge they face. While it’s best practice to have a formal recruitment strategy, more than half of the nonprofits surveyed (64%) do not have a formal recruitment strategy.

Compounding the issue is that many positions require a specialized skill set. Hiring the wrong people wastes precious time and money. Without the right staff in place, organizations are unable to achieve their mission.

Good news— there are tried-and-true ways to attract and retain talent:

Look for referrals from staff – Look no further than your current employee base to help fill open positions. They can be good resources when it comes to selection since they are familiar with the company culture and the skills needed to succeed.

Create good company culture – When employees love where they work, word gets around. Putting in place a strategy to create good company culture is an effective way to attract talent.

Ensure employee engagement – While money is certainly a motivator for employees to stick with a job, commitment to an organization and how well employees feel connected to it can also help retain staff.  

Offer non-monetary perks – From bonus time to special recognition, there are many ways to keep employees happy and reward them without giving a raise.

Training and Development

Since most nonprofits provide a specific service like health care and education, different skills are required to perform these types of jobs. Your employees may not have learned these skills in their formal education and therefore require training. Leaders in particular benefit from instruction in order to be promoted within the organization.

Nonprofit organizations should strive to provide a continuous learning environment. Ongoing training is critical to keep up with best practices and provide a platform for learning new skills and improving others.

Here are some tactics to improve training and development within your organization:

Have clearly defined job descriptions and work processes – This helps with hiring the right people for the right job. It also makes it easier to implement training programs once you’ve established guidelines to measure success.

Properly onboard new hires – Begin the training process at orientation. An onboarding strategy that includes job-shadowing and goal setting sets your new hires up for success.

Vary training methods – Instructor-led training is great for introducing employees to new skills, while informal “on-the-job” training is best for reinforcing and fine-tuning the concepts.

Payroll and Tax Compliance

Payroll is undoubtedly a top concern for nonprofits. Ever-changing regulations make it difficult to remain compliant, while limited staff means there may not be someone on site to actually run reports, process payroll, and cut checks. Nothing upsets an employee more than a late or missing check. And failure to maintain compliance can lead to penalties or automatic revocation of your tax exempt status.

Fortunately, there are a few things you can do:

Adopt good practices to maintain compliance – By maintaining good records, keeping up-to-date on regulations, and implementing measures to prevent conflicts of interest you are taking the appropriate steps to help remain in compliance.

Consider outsourcing – With all the challenges associated with the unique payroll and tax needs of a nonprofit, sometimes hiring a payroll company is your best bet. Do your homework when choosing a payroll company. A reliable one will ensure that employees and taxes get paid properly so that you can focus on the bigger picture—furthering your organization’s mission.

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