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How Do Employee Benefits Work for Nonprofit Organizations?

While their ultimate goal is different, nonprofit organizations operate similarly to for-profit organizations in many ways. Nonprofit organizations need to earn money so that they can fund the causes for which they stand. 

To do this, they need talented professionals who can help them drive growth and operate at efficient and effective levels. Today, no matter what type of organization you run, it’s important to find a way to attract and retain these talented individuals — and that, in many cases, takes a quality benefits package. 

But, how do employee benefits work for nonprofit organizations? Let’s dive into this topic below. 

How Do Nonprofits Operate? 

Nonprofit organizations certainly rely heavily on volunteers to advance their mission and reach more people. At the same time, though, these volunteers are not who make the organization run on a daily basis. 

That work is completed by on-staff employees. 

Just like for-profit organizations, nonprofits have an organizational structure that includes different departments, and they have to operate on a budget. All of this takes people who are experienced in different aspects of running the business — from marketing to accounting to outreach and more. 

In other words, from an internal standpoint, nonprofit organizations often look a lot like their for-profit counterparts. 

Are Benefits for Nonprofit Organizations Different? 

Many nonprofit organizations offer employee benefits packages for an obvious reason — they want to attract people to come to work for them. If they truly want to advance their mission and reach more people, they need the right people in the right positions to do it. 

From a government standpoint, nonprofit organizations are no different than for-profits when it comes to benefit requirements. The Affordable Care Act requires all employees that have at least 50 full-time equivalent employees to offer medical coverage to their employees. If they don’t, they could face stiff penalties. 

While smaller nonprofits aren’t required to offer employee benefits under the ACA, they can qualify for certain tax credits if they do. The Small Business Health Care Tax Credit, for instance, is available to all companies — nonprofit or otherwise — that has 25 or fewer FTEs and pay at least half of their employees’ health insurance premiums. 

Why Should Nonprofit Organizations Offer Benefits? 

Nonprofit organizations have an advantage over for-profit companies when it comes to attracting employees — the fact that they stand for something noble. In fact, their mission is to give back to a cause, a community or a specific set of people. This alone can often attract people to work for them. 

At the same time, nonprofits sometimes find themselves at a distinct disadvantage compared to for-profit companies: They often can’t offer a salary that matches up. 

Luckily, salary isn’t the driving force that it once was for employees. Many people are looking for compensation in forms other than just money when they seek employment. 

This makes it all the more important for nonprofit organizations to offer a comprehensive and creative benefits package to their employees. 

What Benefits Should Nonprofits Offer? 

Nonprofit organizations that are looking to offer benefits to their employees should start with the basics. They should offer group health insurance that could also include vision and dental. They should offer a defined Paid Time Off package so employees can take a mental health day, vacation or not feel like they have to come in when they’re sick. 

They can offer retirement benefits, bonus packages and mental health offerings such as subscriptions to apps, gyms or other resources. 

Nonprofit organizations can also get creative and incorporate benefits that apply directly to their own mission. For instance, a nonprofit focused on cancer research could offer their employees a supplemental cancer insurance policy. If an employee or member of their family is diagnosed with cancer, this policy would kick in and help pay for expenses that aren’t typically covered by a health insurance policy. 

There are many ways for nonprofit organizations to offer competitive employee benefits packages so they can attract the right employees that can help take their organization to the next level. 

Beckham Insurance Group Can Design Benefits Packages for Nonprofits 

In many ways, nonprofit organizations are no different than for-profit companies when it comes to offering employee benefits. Of course, there are nuances that come into play when you’re figuring out what benefits would be best for your organization. 

If you’re located in the Georgia or South Carolina region, Beckham Insurance Group can help you create an excellent benefits package for your employees. To learn more about how we can help your nonprofit organization, contact us today.