Robert Half, a leading company in professional staffing services, provides an extremely valuable resource to the general public in their 2016 compensation guides. The guides cover the following employment areas useful to most nonprofits:
- Accounting and Finance
- Administrative and
- Technology
The guides focus on salaries in the for-profit arena; however, nonprofits should understand their for-profit competition as they attempt to attract the very best talent for their organizations. The lower pay scale in the nonprofit sector is a major challenge, as their needs are comparable to the corporate world but their budgets are typically lower. A compelling mission will only go so far in attracting top candidates.
Nonprofits may also utilize the regional rate conversion table, another valuable tool found in the guides, to adjust the average compensation levels to account for geographic compensation differences.
The data available in this guide will help nonprofits justify the salaries they are paying for some of their top positions. Nonprofits must be able to demonstrate to the IRS that they are paying reasonable compensation and avoid the pitfalls of excess benefit transactions. It is crucial that a nonprofit be aware of the comparability of the statistics (for example, whether the statistics relate to for-profit versus nonprofit organizations) and be prepared to justify the rationale when the salaries offered approach the higher end of the corporate scales.
In addition, organizations should obtain data from other comparable nonprofits, which can be located on IRS Form 990 (organizations must disclose salary data for each employee that earns over $100,000 on the 990). The following website publishes the 990s for nonprofits that have filed their returns with the IRS: www.guidestar.org. In addition, TheNonProfitTimes produces a nonprofit salary guide that is available for purchase.