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Bylaw Amendment and Employment


Guest Motti

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Hello all,

 

Currently, the bylaws say nothing about whether or not an employee of our nonprofit can be on the board. Recently, a board member was hired by the nonprofit. He is seeking re-election to the board at our annual meeting. Another member is putting forth an amendment to the bylaws: Please ignore the atrocious grammar and structure when possible:

 

Where as the duties of the Board of Directors outlines management of employees and

Where as it creates a conflict of interest for a board member to be both an employee and on

the Board trying to manage and govern employees therefore be it

Resolved that no Board of Director member should be considered for or apply for employment

at [the nonprofit] during the time to which they have been elected to serve on the Board of

Directors therefore be it finally

Resolved  that any Board of Director member currently holding positions in both must

immediately choose one and relinquish the other.

Article IX paragraph 2 letter f “new” No elected board member shall apply for or be considered

for employment by the [the nonprofit].

 

How does this apply to a contract of employment that has already been signed? Let's say this passes, and the member is also re-elected. It would seem to me that the nonprofit is still bound by the contract (which goes until Dec 31.). At the end of the meeting, if the member-employee did not give up one or the other, the option available to the society would be to remove him as a Board member, but not as an employee?
This resolution is so terribly written that I am having trouble thinking straight.
 

 

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How does this apply to a contract of employment that has already been signed? Let's say this passes, and the member is also re-elected. It would seem to me that the nonprofit is still bound by the contract (which goes until Dec 31.). At the end of the meeting, if the member-employee did not give up one or the other, the option available to the society would be to remove him as a Board member, but not as an employee?

 

In my opinion, the resolution is out of order as it is currently written. A rule which forced a member to relinquish his position on the board would need to be in the bylaws, and as I understand it, the proposed resolution does not make that part of the resolution a part of the bylaws.

 

Since you're dealing with contracts, you'd need a lawyer to see what options you'd have to remove a member from his position as an employee. Personally, I think it would be best to avoid that headache and focus any amendments to the bylaws on eligibility for the board. The organization could provide, for instance, that an employee shall not be eligible to serve on the board.

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Hello all,

 

Currently, the bylaws say nothing about whether or not an employee of our nonprofit can be on the board. Recently, a board member was hired by the nonprofit. He is seeking re-election to the board at our annual meeting. Another member is putting forth an amendment to the bylaws: Please ignore the atrocious grammar and structure when possible:

 

Where as the duties of the Board of Directors outlines management of employees and

Where as it creates a conflict of interest for a board member to be both an employee and on

the Board trying to manage and govern employees therefore be it

Resolved that no Board of Director member should be considered for or apply for employment

at [the nonprofit] during the time to which they have been elected to serve on the Board of

Directors therefore be it finally

Resolved  that any Board of Director member currently holding positions in both must

immediately choose one and relinquish the other.

Article IX paragraph 2 letter f “new” No elected board member shall apply for or be considered

for employment by the [the nonprofit].

 

How does this apply to a contract of employment that has already been signed? Let's say this passes, and the member is also re-elected. It would seem to me that the nonprofit is still bound by the contract (which goes until Dec 31.). At the end of the meeting, if the member-employee did not give up one or the other, the option available to the society would be to remove him as a Board member, but not as an employee?

This resolution is so terribly written that I am having trouble thinking straight.

 

In the first place I wouldn't vote for a resolution that misspells "Whereas",

 

Intepretation of your bylaws is up to your members.  But my advice is:  If people do not like employees to run for the board, they should simply not vote them onto the board.  And if board members do not like to have board memers as employees, then they should not vote to hire them.

 

That's simple, as well as flexible enough for unanticipated situations.

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In the first place I wouldn't vote for a resolution that misspells "Whereas",

 

Intepretation of your bylaws is up to your members.  But my advice is:  If people do not like employees to run for the board, they should simply not vote them onto the board.  And if board members do not like to have board memers as employees, then they should not vote to hire them.

 

That's simple, as well as flexible enough for unanticipated situations.

 

Tsk Tsk Tsk. You don't understand. What you are suggesting would be reasonable. Therefore, it is not good enough. :P

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In my opinion, the resolution is out of order as it is currently written. A rule which forced a member to relinquish his position on the board would need to be in the bylaws, and as I understand it, the proposed resolution does not make that part of the resolution a part of the bylaws.

 

Is that because it does not specify where in the bylaws the text (everything above Article IX) would be placed?

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Is that because it does not specify where in the bylaws the text (everything above Article IX) would be placed?

 

I don't see where the resolution specifies that the text above the words "Article IX" will be placed in the bylaws at all. But yes, if it is intended as an amendment to the bylaws, it should be specified exactly what language will be put in the bylaws and where that language will be placed.

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This may be sort of a separate question, but if the following were offered as an amendment to replace everything after the preamble, would that be out of order as being too big of a change? I have trouble with knowing how that is determined.

 

Resolved, that a Member of the Board of Directors who has applied to be employed by [the organization] or who is employed by the [organization] may not vote at meetings of the Board of Directors until such time that the member’s employment has ended or the application for employment is denied or withdrawn.

 

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This may be sort of a separate question, but if the following were offered as an amendment to replace everything after the preamble, would that be out of order as being too big of a change? I have trouble with knowing how that is determined.

 

Resolved, that a Member of the Board of Directors who has applied to be employed by [the organization] or who is employed by the [organization] may not vote at meetings of the Board of Directors until such time that the member’s employment has ended or the application for employment is denied or withdrawn.

 

Scope of notice is a bit of a judgment call, but I believe this would be within the scope of the notice, although be sure to specify the exact language to be added to the bylaws and where that language shall be placed.

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Our bylaws are quite terribly worded, and I don't seek to exacerbate that problem. I would like to bring up the following as a bylaw amendment. I was hoping to check for clarity problems and to make sure my interpretations are correct.

 

Amend the bylaws by adding the following paragraph to Article V:

A Member of the Board of Directors who has applied to be employed by the [organization] or who is employed by the [organization] may not vote at meetings of the Board of Directors until such time that the member’s employment has ended or the application for employment is denied or withdrawn.

 

I want to keep it simple, and leave it at the above, but the following is in case there is any concern for how quorum is determined:

"While a nonvoting member of the Board due to status of employment or employment application, the member is not considered a member of the Board for purposes of determining quorum."

My goal here is to establish that if there are 14 members on the board, and one of them is an employee, there are considered to be 13 for purposes of establishing quorum. Without the above amendment, the member would count towards the quorum even though they don't vote, correct

 

I am quite sure that any member-employee would leave the room without being asked if issues of employment came up, but in case someone gets worried they won't:

"In the event that the Board shall discuss compensation or evaluation of the member-employee pertaining to the status of employment, the member-employee can be compelled to leave the meeting for the duration of the discussion with a 2/3 vote."

Is there possible confusion with the term "member-employee," or is that plain enough for the average bear?

 

Personally, I like just fine the idea of don't want it, don't vote for it, for the assembly electing employees and the board employing, members, but that simply won't fly in my organization.

 

Maybe I am overstepping what this forum can be used for, but even if they are not official answers, I would appreciate anyone's opinion. Thank you.

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I want to keep it simple, and leave it at the above, but the following is in case there is any concern for how quorum is determined:

"While a nonvoting member of the Board due to status of employment or employment application, the member is not considered a member of the Board for purposes of determining quorum."

My goal here is to establish that if there are 14 members on the board, and one of them is an employee, there are considered to be 13 for purposes of establishing quorum. Without the above amendment, the member would count towards the quorum even though they don't vote, correct

 

If a member does not have the right to vote, I'd argue that the member would not count towards the quorum, since a member in the sense RONR uses the term has the right to vote. If you feel more clarity is necessary, however, just define the quorum as "The quorum shall be a majority of the voting members of the board," or something to that effect.

 

Is there possible confusion with the term "member-employee," or is that plain enough for the average bear?

 

Seems plain enough to me.

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I can't help but wonder what the purpose of keeping such an "member-employee" on the board at all is, if that person can't vote, doesn't count toward a quorum, and can be forced out of the room when any discussion of employment comes up. It would seem to be simpler to just say "any employee of the organization shall not be eligible for election to the board during the term of employment".

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I can't help but wonder what the purpose of keeping such an "member-employee" on the board at all is, if that person can't vote, doesn't count toward a quorum, and can be forced out of the room when any discussion of employment comes up. It would seem to be simpler to just say "any employee of the organization shall not be eligible for election to the board during the term of employment".

 

Since the concern is not only about employees being elected, but also about current board members being appointed as employees, I think "shall not be eligible to serve on the board" would be preferable to "shall not be eligible for election to the board."

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