Send me more money!


Sound ridiculous?

But what about when the funder is also the decision maker for the salaries of your unionized employees? 

Being in the social services field, many of our contracts are for delivering services on behalf of the government, both provincial and federal. In our particular jurisdiction many of the employees of nonprofit entities have become members of the same bargaining agent as government workers which means our funders have also become the negotiator of how much we may in salaries and benefits. Unfortunately, these salary decisions extend to our other programs, regardless of who funds them.

This incestuous relationship came to a head this year where employees were given a pay raise which included retroactive pay for the prior year as well as current, the compounded effect being 14%. Having to pay the raises was a contractual obligation on behalf of the nonprofits; unfortunately recovering these funds from the decision makers was the next challenge, and although they eventual came good for it, the process was lengthily and the attitude being they were doing us a favour.

There are other challenges when working for the government including their financial administration laws and policies which are not the same as the ones the nonprofit organization is governed by. With this, how they want certain transactions reported are in conflict with the requirements of our regulators.

Unfortunately the bureaucrats sometimes need to be reminded we are not an extension of them, we are our own legal entity who has a different set of rules to live by. One fact which compounds the problem is when government program officers are not finance professionals themselves yet are given responsibility for managing program funding and the associated reporting; sometimes this results in contractors being asked to do something which violates the financial reporting requirements they are governed by.

Here is a little tip for you: if you are going to give an employee financial authority and accountability, provide them appropriate training.



Popular posts from this blog

Serving the public is a business

Nonprofit Financial Management - Means to an end inverted

Admin Allocation - 10% is a Myth