Can a Non-Profit Entity’s Employees also be Volunteers?

The short answer is “yes,” with a huge caution.  Please read below for the details.

On May 2, 2018, I wrote For-Profit Companies Must Pay “Volunteers.”  I wanted to help entrepreneurs understand that the people who provide something of value to their companies must be compensated for it.

In an interesting twist, I was recently asked by a Board member of a non-profit entity whether it was lawful to pay a willing employee an amount less than minimum wage on the theory that they were volunteering.

People do routinely volunteer their time and talent to a non-profit whose mission motives them. It seemed logical that a person who could agree to take $0.00 per hour could also agree to take $5.00 per hour (rather than the current $7.25 per hour U.S. minimum wage) from that same non-profit.

These and related questions must come up pretty often. The U.S. Dept. of Labor has actually addressed them in Fact Sheet #14A: Non-Profit Organizations and the Fair Labor Standards Act (FLSA)

The Fact Sheet provided a definitive answer:  “In addition, paid employees of a non-profit organization cannot volunteer to provide the same type of services to their non-profit organization that they are employed to provide.”

This does not mean a non-profit’s employees can’t do any volunteer work for the entity.  It does mean the volunteer work must be clearly different from the paid work.  For example, the entity’s paid payroll administrator can volunteer to serve food at a free medical clinic that the entity is conducting at a city-wide health fair on the weekend.

The moral of the story is that non-profit entities need to be just as diligent as for-profit businesses when it comes to complying with our employment laws.

Michael Oswald

michael@msochartered.com

www.msochartered.com

Please note: the above post contains educational information. It is not intended as legal advice. Engage an attorney who is licensed in your state to get advice on dealing with any specific legal issue.

© 2018 Michael S. Oswald

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