Most nonprofits exist to implicitly, if not explicitly, improve lives. Yet nonprofits often do not have a human resources professional on-hand to help their own employees navigate professional growth, benefits (when applicable), and other career essentials.
The leading face value reason – cost – is understandable. More on this momentarily. Still, the consequences of no HR are impossible to ignore. High turnover is plaguing the nonprofit sector – an issue the National Council on Nonprofits goes as far as to call a crisis. Nonprofits currently have the fifth highest turnover rate of any industry. This is not entirely surprising. Nonprofits tend to be labor intensive, with slim headcounts and lower pay than for-profits, making them uniquely susceptible to employee loss.
Still, consequences loom. Anyone whose workplace has experienced a talent exodus (or even the loss of one strong or longstanding employee) knows firsthand how turnover can jeopardize everything from effectiveness and efficiency to productivity. In nonprofits, turnover also runs the risk of dampening fundraising efforts and donor retention that are so critical to operations and impact.
Because professional HR can have a positive impact on operations and employees, the nonprofit turnover crisis has nonprofits reconsidering their sector-wide habit of cobbling together HR in-house. And retention isn’t the only reason a growing number of nonprofits are seeking out bona fide HR professionals.
Before discussing the benefits of professional HR to nonprofits specifically, a reminder of HR’s potency and role in any sector:
Human resources is often organized into three categories – compliance, payroll, and employee-facing expertise such as hiring, management council, employee relations, and benefits administration. In practice, employee-facing aspects of HR can include performance management, onboarding and offboarding, employee handbook creation, surveys, and much more. Beyond ensuring an organization is operating legally where all things employees are concerned, HR brings out the best in workers by making sure they’re heard, acknowledged, and supported the way all people want to be supported in their workplace.
So how is HR specifically and uniquely valuable to nonprofits?
A leading benefit of nonprofit HR is balance and bandwidth. Ask any executive director, board chairperson, or accountant forced to lead and execute HR on their nonprofit’s behalf: HR is immensely time-consuming and complex, even in nonprofits with low headcounts. Non-HR professionals rarely have the time, education, and training to pull it off, often leading to compliance risk and other fallout. Additionally, there’s inherent conflict when leadership is the HR contact for employees who view them as a manager, not HR. This uncomfortable reality can hinder employee candor and therefore HR effectiveness overall. On the flip side, when nonprofits tap professional HR, it frees up internal resources to “stay in their lane,” so to speak, so they can leverage their true strengths toward moving the nonprofit mission forward – which also dramatically improves HR effectiveness.
As touched on earlier, there’s also the timely matter of retention. On average, nonprofits pay employees less than for-profits ($4.67 an hour less, according to the Bureau of Labor Statistics) – a leading reason nonprofits are experiencing record turnover. Luckily for nonprofits looking to retain their people, every aspect of professional HR is designed to improve employees’ experience, increasing their satisfaction, productivity, and, often, loyalty.
Then there’s morale – the gas in the engine of every employer, and mission-focused nonprofits especially. Morale is so much more than turnover prevention. It is a nonprofit’s lifeblood. If nonprofit employees feel meh or worse about their jobs, donors will notice; fundraising and impact take a hit, as do productivity and brand reputation. From designing and distributing employee surveys that gauge morale to implementing a myriad of ways to boost it, professional HR is a key ingredient in keeping a workforce engaged and, yes, happy.
Hiring is another area elevated by professional HR. A strong hiring strategy by a professional HR firm like myHR Partner helps you attract talent that’s a culture fit and whose skills align with what a role demands. We also provide a responsive, organized, and overall positive hiring experience for applicants, which can increase chances of candidates accepting offers and boost your nonprofit’s professional reputation, too. Discover how myHR Partner’s polish and expertise helped one Pennsylvania nonprofit successfully secure hard-to-find seasonal employees.
Of course, the benefits of professional outsourced HR for nonprofits don’t end there. From regulatory compliance to payroll administration to employee conflict management and resolution, myHR Partner infuses nonprofits with the true competitive edge they crave.
Most nonprofits forego professional HR due to cost. Putting HR on the desk of an existing employee is often deemed wiser than adding more overhead. However, myHR Partner emphatically believes it’s more accurate to frame this objection to professional HR as perceived cost. Professional HR is an investment, yes. But it is often more in-reach than nonprofits realize, for a few reasons:
For one, outsourced HR for nonprofits offers a more affordable alternative than a single in-house HR hire.
Secondly, outsourced HR like myHR Partner’s can lead to cost savings. Reduced turnover alone dials down hefty recruiting, hiring, onboarding, and training expenses. Even more, professional HR may lead to stronger nonprofit performance, setting off a financial snowball effect of the best variety.
Culture is another reason many nonprofits shirk HR – or at least outsourced HR. “They’ll never quite understand us, so let’s just manage our people on our own.” At myHR Partner, we know – and love the fact – that nonprofits often have unique, strong cultures. We commit to getting to know your culture and mirroring it when we work with you and for you. myHR Partner carefully endeavors to feel like a natural extension of your team – just like we are for these happy nonprofit myHR Partner clients.
Ready to experience expert nonprofit HR services which can elevate every aspect of your mission-driven organization? Reach out to myHR partner for a free, no-obligation myHR consultation. Our team specializes in nonprofit HR (including private foundation HR) and tailors our approach to your exact culture and goals.
Still not sure your nonprofit warrants professional HR? Take our 5-minute HR Fitness Test to uncover risks and opportunities which may help you decide.