Director resignations result in loss of quorum

[Guest TLF]

I'm the Secretary of on 7-person non-profit board. After nearly 2 years of frustration, we finally brought the issue of firing our ED (and replacing her with an Operations Manager) to a vote. The vote passed 4-1 (one of the board members was absent, as usual, and the Chair himself did not cast a vote). After the vote, the dissenting board member became extremely irate by the outcome, and threatened to quit, adding that the decision would ruin the organization. We all agreed to have a cooling off period, and meet again in a few days when emotions had settled. The following day, however, we received a professional resignation letter from the Chair, and a not-so-professional resignation letter from the irate board member.

Later that evening, we received an email from the ED stating that the staff was joining a Union. It seemed clear that the irate board member let the proverbial "cat out of the bag," and informed staff what the board had decided. Things are messy right now, and we are trying to put things back together.

Our bylaws set our board meeting quorum at 5. Having lost 2 members, we are now down to exactly 5 board members, so there's really no breathing room. The problem is that the 5th board member very rarely attends meetings, and, without his attendance, we do not have quorum, and therefore cannot conduct official board business. We would like to appoint a new director to the board. We have a prospective member who is interested in joining, but would require the attendance of the 5th board member in order to vote this appointment into effect. Being absent for so long, he is now not sure what he wants to do...so we are waiting (and hoping) that he is willing to at least attend a meeting so that we can move forward. 

In the meantime, we have not formally accepted the resignation letters from the outgoing board members -- how could we, since we can't reach quorum in order to do so. 

I've read a few comments on this forum about board having to formally "accept" a resignation. If this is true (or even if it's not true) could we ask the Chair to retract his resignation letter so that we could hold a meeting, appoint a new director, after which point the Chair could step down?  

This is becoming too much work for me, and I feel like I'm in in over my head. Rather than resigning myself, I thought I'd try reaching out to this forum. Does anyone have any advice they could offer? I'm sure I'm missing something!  Thank you in advance. 

[J. J.]

The resignation must be accepted and, once pending, could technically be rejected(32:2, 32:5).  The member could withdraw the request prior to it being stated by the chair (33:12).

The short answer is yes, the chair could withdraw his resignation and submit it at a later date. 

[Bruce Lages]

I don't think it's necessary to have the chair retract his resignation letter. You could ask the chair to attend the next meeting, at which you will formally accept his resignation, but only after you appoint a new director with his help.

[Atul Kapur]

6 hours ago, Guest TLF said:

I've read a few comments on this forum about board having to formally "accept" a resignation.

This is true under RONR, as J. J. said, above. You should check your bylaws to see if they say anything about resignations; some say that they are effective once received, without requiring that they be accepted. That would make your situation more difficult, but you should check and confirm.

[Guest TLF]

Thank you for your responses. We've reached out to the former Chair, but he does not want to be involved, especially now that there's a possible union on the horizon. As such, we are up against deadline for a union vote (for 2 staff members) this week. 

According to our bylaws: 

(1) Vacancies on the Board, however caused, may, so long as a quorum of directors remain in office, be filled by the directors from among the qualified members of the Society, if they shall see fit to do so; otherwise, such vacancy shall be filled at the next annual general meeting of the members.

(2) If there is not a quorum of directors remaining in office, the remaining directors shall forthwith call a meeting of the members to fill the vacancy.

My questions now are: 

a) Is it possible to even call a meeting without quorum?

b) With the impending union vote this coming week, even if we could call a meeting, do we require 14 days notice of an extraordinary meeting?

c) Without quorum, can we even negotiate with a union on behalf of the organization?

d) If we all resign, what will the union do?

e) Given the time constraint, can we appoint a new director in the meantime? 

If you think it would be better to start a new thread for this, or take my questions elsewhere, please let me know. 

Thank you

 

[Gary Novosielski]

a. You can certainly call such a meeting without a quorum, as the bylaws specifically authorize it, and in fact require that it be done "forthwith".

b. I don't know if 14 days notice would be required.  RONR says only that a "reasonable" time must be allowed.  So I assume that your bylaws specify 14 days.  If so, I don't see any exception to that rule in what you've quoted.

c. You can, and probably should, negotiate through a committee that intentionally comprises less than a quorum of directors.  But you cannot vote to adopt any agreement until you have a functioning board.  And you would probably want the union to vote to accept the agreement first.

d.  I have no idea.  And probably, neither do they.

e.  No.

[Josh Martin]

9 hours ago, Guest TLF said:

a) Is it possible to even call a meeting without quorum?

Yes.

9 hours ago, Guest TLF said:

b) With the impending union vote this coming week, even if we could call a meeting, do we require 14 days notice of an extraordinary meeting?

I don't know. Your bylaws should specify the amount of notice required to call a special meeting. If they specify that 14 days of notice is required, and no exceptions are provided, then 14 days of notice is required.

9 hours ago, Guest TLF said:

c) Without quorum, can we even negotiate with a union on behalf of the organization?

Without a quorum you can't do much of anything.

Can you offer either the person who hasn't been showing up to meetings or one of the two board members who recently resigned (but whose resignations have not yet been accepted) a nice dinner or drinks or something in exchange for showing up to one more meeting, at which resignations could be accepted and new board members could be elected? They don't even have to pay attention, they just need to be there. Just make sure to provide notice of the intent to fill the vacancies at this meeting.

9 hours ago, Guest TLF said:

d) If we all resign, what will the union do?

I have no idea, but keep in mind that a quorum is needed to accept resignations.

9 hours ago, Guest TLF said:

e) Given the time constraint, can we appoint a new director in the meantime? 

Your bylaws provide that a vacancy must be filled by the board at a meeting. So if your question is whether you can appoint a director prior to such a meeting, the answer is no.

I would note that, with all the employee and union issues involved here, I expect your board is ultimately going to need an attorney more than a parliamentarian.

9 hours ago, Gary Novosielski said:

a. You can certainly call such a meeting without a quorum, as the bylaws specifically authorize it, and in fact require that it be done "forthwith".

I don't think that is quite the situation the organization finds itself in. The rule appears to refer to a situation in which there are not enough directors in office to constitute a quorum. So far as I can tell, there are still enough directors in office to constitute a quorum, but some of them don't feel like showing up to meetings. I think the board actually still has seven members, since it seems that the two recent resignations have not yet been accepted. Even if those persons are no longer members, the board still seems to have five members, but one of the five doesn't bother showing up to meetings.

So I think the applicable rule here is "Vacancies on the Board, however caused, may, so long as a quorum of directors remain in office, be filled by the directors from among the qualified members of the Society, if they shall see fit to do so; otherwise, such vacancy shall be filled at the next annual general meeting of the members."

9 hours ago, Gary Novosielski said:

c. You can, and probably should, negotiate through a committee that intentionally comprises less than a quorum of directors.  

But they can't appoint such a committee without a quorum.

Edited November 1, 2020 at 04:39 PM by Josh Martin

[Guest TLF]

I was just re-reading our bylaws, and I found this rule under the sub-category of "Directors and Officers." 

29. No act or proceeding of the directors is invalid only by reason of there being less than the prescribed number of directors in office. 

This forum has helped my thinking.  I guess our dilemma isn't about having enough directors on the board, but more its about having enough directors who will actually attend a meeting so that we have quorum and can conduct board business, like making a motion to hire a lawyer, for instance--I'm assuming this requires a motion, but maybe (hopefully) I'm wrong. 

The absent board member is willing to consider attending a meeting so that we can appoint a new member.

At this point, I am overwhelmed. We also spoke with another organization who just went through this process. We were told that the union is very adversarial. This is not what I signed up for. 

Although it's not my nature, I am tempted to resign. If there is no board, then who can the union negotiate with?  While I care deeply about the organization, I have neither the skills nor the desire to enter into a negotiation process with a union. I am not personally opposed to unions, but I think that the legal costs will be too much for our small non-profit charity, especially if any Covid-related austerity measures (resulting in government cuts to arts organizations) are implemented. 

 

[Gary Novosielski]

7 hours ago, Josh Martin said:

But they can't appoint such a committee without a quorum.

It would not be uncommon for such a committee to have been appointed some time before, in anticipation of the need to do research and develop negotiating strategies and parameters.  There could well be a standing committee on negotiations, or one whose mission is broad enough to include such discussions.

I agree that in the given situation this might not be the case, since apparently the prospect of union organizing was not anticipated.  But it's worth going over the portfolios of the standing committees, and the rules about what matters, if any, they may take up on their own initiative.