Can Employees Volunteer for Your Nonprofit?

Can Employees Volunteer for Your Nonprofit?

Can Employees Volunteer for Your Nonprofit?

Volunteers often play a critical role in enabling nonprofits to deliver their programs and services. Volunteers may serve on the board of directors, help with fundraising campaigns, or work in direct customer service roles. People volunteer because they care about the cause and want to make an impact. 

Your employees are no exception. Their passion for your cause likely drew them to their position in your organization. So it’s not surprising that this same passion and dedication to your mission may lead them to seek a recurring volunteer position outside of their regular duties or to volunteer in a one-off capacity, such as during special campaigns, seasonal events, or when there aren’t enough volunteers to cover services or day-to-day tasks by employees.

While it’s fortunate to have dedicated employees who want to volunteer after their regular work hours, allowing nonprofit employees to volunteer could cause you to unknowingly violate the law if not done properly. The Department of Labor (DOL) enforces rules under the Fair Labor Standards Act (FLSA) that limit the potential manipulation or abuse of minimum wage and overtime requirements. Specific rules are in place to ensure employees aren’t being pressured to volunteer. Violating these rules, even unknowingly, can result in lawsuits, monetary consequences, along with placing your employee’s rights and protections at risk.

What factors distinguish an employee from a volunteer? 

An employee has different legal protections than a volunteer. FLSA sets forth rules to determine whether workers are employees or volunteers and what protections might apply. FLSA defines volunteers as people who freely provide services without any expectation of compensation for public service, religious, or humanitarian objectives. 

The DOL considers multiple factors when determining whether a person is an employee or a volunteer. The factors include but may not be limited to whether:

  1. The activity is less than a full-time occupation; 
  2. The volunteer time is for a civic, charitable, or humanitarian purpose without any expectation or receipt of compensation by the employer; 
  3. The employee is truly and freely volunteering their time without any implied or direct coercion from the employer; and 
  4. If regular employees have been displaced to accommodate the volunteer. 

What conditions should be in place before allowing nonprofit employees to volunteer? 

Before permitting an employee to volunteer, you’ll want to carefully assess the situation and conditions to make sure you are creating an authentic volunteer experience and abiding by the DOL’s rules. These include:

1. Verifying that the employee is freely volunteering.

There should be no expectation or pressure, either directly or indirectly, for an employee to volunteer. The employee must be motivated to volunteer freely from charitable motives. 

2. Making sure the type of volunteer work is not similar to an employee’s regular duties.

An employee can’t volunteer to do work that is part of their regular employment duties. There is no exception to this condition. For example, if your employee is paid to greet and check-in visitors, that person can’t volunteer to welcome visitors. Any volunteer duties they have must not be part of their regular duties. 

3.  Ensuring the volunteer work being done by an employee does not displace a regular employee position.

Volunteer work should not replace a paid employee position. Additionally, volunteer positions should be part-time. Otherwise, this situation raises the question of whether the position should be considered a full-time employed position. It is up to the employer to track employees’ time.  

4. Making sure the volunteer work is done outside of regular work hours.

An employee can’t complete volunteer work during their normal work hours, even if the volunteer duties are different from their regular job duties. There must be a clear distinction between an employee’s work hours and volunteer hours.

5. Not compensating the employee for volunteer work. 

As a nonprofit, you value your volunteers. Yet, providing compensation to show your appreciation may jeopardize their volunteer status and lead to a loss of legal protection to your volunteer. For example, the Volunteer Protection Act (VPA) provides protections for volunteers who don’t receive compensation in excess of $500 per year. If volunteers receive things of value that exceed this amount, they will lose their VPA protections against liability. 

Providing compensation to employees for their volunteer work also can increase your risk of a wage and hour dispute. According to the DOL’s Wage and Hour Division, compensation paid to volunteers must be nominal, not a substitute for compensation, or tied to productivity

While there isn’t set guidance on what constitutes nominal compensation, DOL does indicate that fees should not be more than twenty percent of what an employer would otherwise pay to hire a full-time employee for that service. You also should not offer benefits that are tied to hours of work. 

6. Ensuring the nature of the work is in keeping with typical types of volunteer work.

You can’t use volunteers to work in unrelated businesses that function as commercial enterprises, although a nonprofit may engage in commercial activities. For instance, a nonprofit nature organization that runs gift shop can’t use volunteers in the shop, only paid employees. 

Best practices when nonprofit employees want to volunteer

The FLSA does allow employees of a nonprofit to provide volunteer services for their employer under the right conditions. That said, having an employee say they don’t mind not being paid cannot shield you from FLSA violations; an employee can’t voluntarily surrender their FLSA rights. 

To avoid potential legal problems, consider incorporating these best practices when an employee wants to volunteer:

  • Create a separate volunteer handbook from your employee handbook that includes guidelines for employees who choose to volunteer.
  • Have employees sign up and follow the typical volunteer procedures when they are volunteering.
  • Ensure supervisors know when an employee is volunteering to reduce the risk of being asked to perform their regular duties.
  • Provide volunteers with a standard expense reimbursement form that requires a receipt or invoice, so you have clear documentation.
  • Make sure any appreciation gifts are small and nominal to avoid exceeding the DOL’s standards.

Volunteers play a critical role in many nonprofit organizations. However, it’s vital to ensure that all labor and volunteer rules are being followed. While it is possible for employees to also volunteer, you should approach this situation with care and consideration to avoid costly wage and hour claims. 

Ellis Carter is a nonprofit lawyer with Caritas Law Group, P.C. licensed to practice in Washington and Arizona. Ellis advises nonprofit and socially responsible businesses on corporate, tax, and fundraising regulations nationwide. Ellis also advises donors with regard to major gifts. To schedule a consultation with Ellis, call 602-456-0071 or email us through our contact form.

ELLIS CARTER

CharityLawyer Blog is published by Ellis Carter, the founder of Caritas Law Group (formerly, Carter Law Group), a law firm with offices in Tempe, Arizona.

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Caritas Law Group exclusively represents tax-exempt, non-profit, and mission-based businesses, as well as major donors and companies engaged in cause marketing. With offices in Tempe, Arizona, our attorneys are licensed to practice in Arizona and Washington and represent clients with regard to federal tax matters nationwide.