Last Of The Great Pretenders

Last month when I heard that Herb Reed of the Platters had died and was reminded that he had waged a fairly protracted legal battle over the use of the Platters name, I thought back to an entry I did about the question of who owns a band’s name.

At the time, there were over 80 groups listed performing under the Platters name and a number of people, including Reed claiming ownership. There was a push for truth in music laws to keep imposter bands but as noted in my entry and the NPR story I link to, it isn’t always very easy to determine who has the most valid ownership claim.

As something of a postscript to my original entry, Reed was ultimately successful in exerting his claim as the sole original member.

Shorter Board Meetings? You Have My Consent!

Last week a very interesting article came down my Twitter feed, (I apologize for not noting the source), written by Les Wallace about the best board meeting he ever attended.

What made it the best meeting he ever attended was a very effective use of the time, revolving around the use of a consent agenda. I had not really heard of a consent agenda before, but fortunately the folks over at Board Source wrote up a handy guide explaining:

A consent agenda is a bundle of items that is voted on, without discussion, as a package. It differentiates between routine matters not needing explanation and more complex issues needing examination.

[…]

With a consent agenda, what might have taken an hour for the board to review, takes only five minutes. Because it promotes good time management, a consent agenda leaves room for the board to focus on issues of real importance to the organization and its future, such as the organization’s image and brand, changing demographics of its constituents, or program opportunities created by new technology.

According to Board Source the types of things typically found in a consent agenda are the minutes of the previous meeting, confirmation of decisions, the CEO and committee reports, informational materials and routine correspondence. You don’t want to have financial documents and anything potentially controversial or requiring substantive discussion and decision making as part of the consent agenda.

It takes a fair amount of work to compile all this information. The organization has to be disciplined all the way through. Wallace mentions the work the CEO, staff and other board members did in advance to prepare the materials and have it placed it in the board section of the website for review two weeks prior to the meeting.

Wallace also mentions the board meeting moved from important to trivial matters rather than following Robert’s Rules of Order. The financial statements provided were color coded dashboard summaries of the organization’s financial position provided by the finance committee. An executive summary of staff and committee reports were provided at the meeting with more detailed information available online.

According to Wallace, this cut about 40 minutes out of the meeting and the board used that time to address strategic issues for the organization, attend to some board development and other governance issues.

The Board Source article has more information about how to use a consent agenda and exercises to use to help transition boards to this practice. It’s worth a look if this sounds the least bit intriguing to you.

One of my initial concerns was that the consent agenda could be used to hide problems amid minutiae or circumvent board members, but according to the Board Source guidance (my emphasis):

“If a board member has a question, wants to discuss an item, or disagrees with a recommendation, he or she should request that the item be removed from the consent agenda. Without question or argument, the board chair should remove the item from the consent agenda and add it to the meeting agenda for discussion.”

Using a consent agenda requires a great deal of discipline on the board if it is going to be effective-

“Just a quick question” is not an option when using a consent agenda. Either an item is removed and discussed or it stays put. This places the burden of facilitation on the board chair to be disciplined about stopping discussion and removing items from the consent agenda.”

Info You Can Use: Doing Business With Board Members

Since I am on the topic of board decisions this week, Non Profit Law blog recently listed a link about non profits doing business with their own board members.

While it is natural for non profits to seek out people from specific professions/skillsets to be on their boards in order to provide some expert guidance and advice, things get a little sticky when it becomes necessarily to contract professional services.

Since board members often have a personal investment in the organization, they may tend to charge extremely competitive fees for their services. As the article notes, it can also be a little awkward to be talking about paying someone else to do work that a board member in the room is perfectly capable of performing.

The article notes that not only is it difficult to avoid having some business dealings with your board members, it may be hard to actually get good people to serve on the board if they perceive there will be undue scrutiny of how their professional and volunteer activities overlap.

However, it is important to have a conflict of interest policy for board service. Failing to have one and follow it create potential problems for the organization, especially given the role non-profits serve in their communities.

Experts say one danger of so many veteran board members is that a nonprofit could lose touch with how a community perceives the awarding of contracts to members of its own board.

“Public legitimacy and support are very important, and a more isolated board may not be as aware of that,” said Francie Ostrower…

[…]

Board Source , an organization for nonprofit boards recommended by the National YMCA, suggests that board members who want to do work for the organization should donate their services. If they can’t, they should follow the board’s conflict policies.

Other critics of the practice such as Joshua Humphreys, a fellow at Tellus Institute, a Boston policy think tank, take a dimmer view.

“Best practice for nonprofits is to draw a bright line between board service and doing business with service providers,” said Humphreys. “It creates divided loyalties between the public purpose of the charity and the private gains someone is motivated by.”

Siegel (Jack Siegel, Charity Governance) said the practice chips away at the independent thinking of board members who are the recipients of contracts, as they tend to side with their supporters on the board in other matters.

“If you see conflict (of interest), you can almost bet there are other problems in the organization,” Siegel said.

The article goes on to quote Siegel pointing out that it is difficult to hold the work of board members to the standard you should because you have a relationship with them. This point struck a sympathetic chord with me as I remembered some occasions in my career where the quality of the work by a board member was never in question, but changes to elements no one really liked were never requested for fear of offending the board member by questioning their style/taste.

One of the suggestions for eliminating the conflict is that the person leave the board for the duration of their company’s contract under the assumption that if the person is really invested in the success of the organization, they will extend the same discounts as they would when they were serving.

What the article doesn’t mention is that if they don’t extend the same discount it may actually be better for your relationship with the person. If all those involved feel that a fair market price is being paid for the work, there is less potential for resentment on the part of the service provider over sacrificing time and income on a difficult project and less hesitation on the part of the non-profit to assert that their standards be met.

Still, this is all easy to say in theory. In practice, you run into the old question, “how do you fire a volunteer?” When people generously provide time, energy and expertise, they are investing a lot of themselves personally. It can be difficult to refuse their help without making it seem like you are refusing them as a person.

That is why it is good to have a well-constructed conflict of interest policy to which to point. When the situation arises where a board member will start to do business with the organization in a significant way, you can point to the policy and note that providing the service will, of necessity, change the board member’s relationship with the organization and as such the following actions must be taken per the conflict of interest policy.

Board Source has some general information on conflicts of interest on their website and some samples conflict of interest statements for purchase and download. (I have never read them so I can’t attest to their usefulness.)

Info You Can Use: Let Me Take Vacation, Or You’re Gonna Pay!

Hat tip to Non Profit Law blogger Emily Chan for providing a link to an article on a subject near and dear to my heart — vacation time.

There are some problems non-profits can run into regarding vacation and over time pay, but reading further is only necessary if people in your organization work a lot of overtime and don’t take all their vacation.

Hmm, nobody clicked away.

I wasn’t entirely joking when I said problems related to the accrual of vacation and over time were near and dear to my heart. Putting aside the number of vacation and comp time days I forfeited last year, I am regularly told about the guy who retired and wiped out most of the next season’s budget.

That is one of the hazards covered in the piece on Olive Grove Consulting’s blog. While most of the laws discussed are specific to California, there is a pretty good chance your state has similar labor laws.

For instance, in relation to accruing a lot of vacation time:

One law that often catches employers off guard is California’s requirement that employees be paid all vested vacation wages at the time of termination. As a result, an organization should ensure that it has sufficient reserves to pay out all accrued vacation. If an organization has a vacation policy that does not cap the amount of vacation an employee may accrue – and if employees do not regularly draw down their balances by taking vacation – then, the potential liability on the organization’s books can become significant.

California law prohibits employers from adopting “use-it-or-lose-it” vacation policies where vacation is forfeited if an employee does not take it. But, employers are permitted to place a reasonable cap on the amount of vacation that an employee may accrue. Thus, for example, if an organization allows employees to take 80 hours of vacation per year, the organization may cap the maximum vacation accrual amount at 140 hours. That way, even if some employees do not regularly take vacation, they will never accrue more than 140 hours, which will allow the organization to avoid having a significant amount of vacation liability on its books. To do this effectively, the organization must clearly articulate its vacation policy, including all applicable caps, in its handbook or in a stand-alone vacation policy.

Note: I edited answers for two question on this topic together. Also, my emphasis- Joe

The article also covers over time pay and discusses the California definition of employees who may be classified as exempt. This definition, which is very close to the federal definition, is based on spending more than 50% of your time performing certain types of duties or belonging to certain learned professions like lawyers, doctors, accountants (but not bookkeepers), clergy, registered nurses (but not LPNs).

Creative and artistic professions are considered exempt. The Olive Grove blog doesn’t expound, but the federal Fair Labor Standards Act says that:

Some employees may also perform “creative professional” job duties which are exempt. This classification applies to jobs such as actors, musicians, composers, writers, cartoonists, and some journalists. It is meant to cover employees in these kinds of jobs whose work requires invention, imagination, originality or talent; who contribute a unique interpretation or analysis.

So even if your imagination is working over time, you won’t get paid extra for it.

The Olive Grove blog also has some informative material about laws regarding comp time in lieu of pay, disciplining employees who do not record their over time and whether a non-profit can consider over time to be volunteer work.

Just in case you like the idea of voluntary over time but don’t read the article, let me just tell you–DON’T DO IT!

“However, the DOL (U.S. Dept of Labor) also takes the position that individuals may not “volunteer” to perform work for their employer that is the same as or similar to their normal work duties. Instead, this is compensable work time. The DOL is also likely to take this same position regarding time an employee spends performing dissimilar services, if those services occur at the employer’s request, under its direction or control, or during the employee’s normal working hours.”

Again, because the laws of your locality may vary from these, just take this information as a guide to the sort of questions you should be asking about labor laws in your state