Guest Elaine Posted July 9, 2015 at 10:12 PM Report Share Posted July 9, 2015 at 10:12 PM I am on the board of a non-profit and my question is can the President of our organization accept compensation for services rendered to the organization when the by-laws state that officers cannot accept compensation directly or indirectly? Link to comment Share on other sites More sharing options...
Josh Martin Posted July 9, 2015 at 10:31 PM Report Share Posted July 9, 2015 at 10:31 PM I am on the board of a non-profit and my question is can the President of our organization accept compensation for services rendered to the organization when the by-laws state that officers cannot accept compensation directly or indirectly?It's up to your organization to interpret its own bylaws. See RONR, 11th ed., pgs. 588-591 for some Principles of Interpretation. Link to comment Share on other sites More sharing options...
Edgar Guest Posted July 9, 2015 at 10:52 PM Report Share Posted July 9, 2015 at 10:52 PM I am on the board of a non-profit and my question is can the President of our organization accept compensation for services rendered to the organization when the by-laws state that officers cannot accept compensation directly or indirectly? Your bylaws state that officers can't accept compensation and you're asking if an officer can accept compensation? Link to comment Share on other sites More sharing options...
Josh Martin Posted July 9, 2015 at 10:58 PM Report Share Posted July 9, 2015 at 10:58 PM Your bylaws state that officers can't accept compensation and you're asking if an officer can accept compensation?I don't think the question is whether the President can be compensated for his services as President (I agree that the answer to that question should be pretty obvious, due to the rule in question). I suspect the issue is whether the President can be compensated for services he provides above and beyond his duties as President, such as providing legal services, or landscaping services, or whatever. Most organizations with a rule of this nature include a statement clarifying that point, but if this organization has not done so, it will have to interpret the rule as best as it can. Link to comment Share on other sites More sharing options...
g40 Posted July 9, 2015 at 11:10 PM Report Share Posted July 9, 2015 at 11:10 PM Yes - a careful reading and interpretation of your bylaws is needed. For example, I am a member of a Board where the Bylaws do not allow Board members to receive compensation for service as Board members. Although currently no Board members are in such a situation, a Board member could receive compensation from the organization for services rendered for other duties performed for the organization. Also, reimbursement for authorized expenses incurred as a Board member in this organization are also allowed (conference attendance, for example). Link to comment Share on other sites More sharing options...
Guest Guest Posted July 9, 2015 at 11:41 PM Report Share Posted July 9, 2015 at 11:41 PM The situation is this, we hold an annual fundraiser and before our current president became president she was compensated for the printing of our journal, invitations, etc., so I guess what I am asking is now that she is president, is she in violation of our by-laws for doing the printing without asking for board approval and charging us for her services? I say she is, but our executive vice president wants a non biased answer from another source, Link to comment Share on other sites More sharing options...
Timothy Posted July 10, 2015 at 12:37 PM Report Share Posted July 10, 2015 at 12:37 PM The situation is this, we hold an annual fundraiser and before our current president became president she was compensated for the printing of our journal, invitations, etc., so I guess what I am asking is now that she is president, is she in violation of our by-laws for doing the printing without asking for board approval and charging us for her services? I say she is, but our executive vice president wants a non biased answer from another source, Do your bylaws give the president the authority to decide who does the printing? Link to comment Share on other sites More sharing options...
Edgar Guest Posted July 10, 2015 at 12:55 PM Report Share Posted July 10, 2015 at 12:55 PM . . . before our current president became president she was compensated for the printing of our journal, invitations, etc., so I guess what I am asking is now that she is president, is she in violation of our by-laws for doing the printing without asking for board approval and charging us for her services? If she was compensated before becoming an officer, where's the violation? Is she still being compensated? And why do you think the board's approval would make a difference? Link to comment Share on other sites More sharing options...
Guest Guest Posted July 10, 2015 at 03:56 PM Report Share Posted July 10, 2015 at 03:56 PM Yes she is still being compensated and yes there must be a board approval which she took the liberty of by-passing without a board vote. Link to comment Share on other sites More sharing options...
Josh Martin Posted July 10, 2015 at 06:15 PM Report Share Posted July 10, 2015 at 06:15 PM The situation is this, we hold an annual fundraiser and before our current president became president she was compensated for the printing of our journal, invitations, etc., so I guess what I am asking is now that she is president, is she in violation of our by-laws for doing the printing without asking for board approval and charging us for her services? I say she is, but our executive vice president wants a non biased answer from another source,Again, it will ultimately be up to the organization to interpret its own bylaws, but I personally doubt that the rule was intended to prohibit officers from ever being compensated. The intent of such a rule is generally to prohibit officers for receiving payment for their duties as officers, not to prohibit them from receiving compensation for other unrelated goods and services provided to the organization.I can understand how the lack of board approval could be an issue. If the board has never approved this person to take on this task or the compensation for it, then it does seem a bit presumptuous to perform this task and expect compensation. On the other hand, if the board had previously authorized this person to perform this task and to receive compensation for it, then I don't see why the fact that this person has been elected President should necessarily change anything.If this is becoming a problem, then just have the board adopt a motion on the issue one way or the other. Link to comment Share on other sites More sharing options...
Richard Brown Posted July 16, 2015 at 04:29 PM Report Share Posted July 16, 2015 at 04:29 PM The situation is this, we hold an annual fundraiser and before our current president became president she was compensated for the printing of our journal, invitations, etc., so I guess what I am asking is now that she is president, is she in violation of our by-laws for doing the printing without asking for board approval and charging us for her services? I say she is, but our executive vice president wants a non biased answer from another source, I'm late in joining this conversation, but based on the above clarification from the original poster, it looks to me like the issue is more about reimbursing for expenses rather than payment of compensation. If the issue is being reimbursed for expenses, I don't see a problem. If the issue is paying the president for services in designing the invitations and the journal, that is a different issue and may well fall within the prohibition of compensating officers. As others have pointed out, it is up to your organization to interpret your own rules and bylaws. Note: Even if the president exceeded her authority in having something printed, her actions can still be ratified and she can still be paid for any properly reimbursable expenses, provided the action taken would have been proper if prior approval had been granted. That is the purpose of the motion to ratify. Failure of someone to request approval or reimbursement for something in advance is not, in and of itself, a bar to obtaining that approval after the fact by means of the motion to ratify. Link to comment Share on other sites More sharing options...
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