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Nonprofit Fringe Benefits and Working Conditions SurveyedFringe Benefits and Working Conditions in Nonprofit Organizations, 6th EditionPUBLISHED: June 2004 Summary of the 819-page Fringe Benefits and Working Conditions in Nonprofit Organizations, 6th Edition survey report from Abbott, Langer & Associates, Inc., detailing current Work Practices, Overall Cost of Fringe Benefits, General Fringe Benefit Practices, Holiday Practices, Vacation Practices, Special Leave Practices, Insurance Practices, Sick Leave and Short-term Disability Insurance Practices, Retirement Practices, Tax-Advantaged Programs, Employee Service/Assistance Programs, Special Work-Related Expenses, and Educational Assistance follows:
In October 2003, questionnaires were mailed to all past participants in the survey series on compensation and fringe benefits in nonprofit organizations and all past purchasers of the survey reports of those series. As of May 2004, usable responses were received from 1,172 organizations. This summary provides the briefest possible "boil-down" of the voluminous data provided by nonprofit organizations of widely-differing types and sizes. Obviously, fringe benefit and working condition practices can and frequently do vary by region, annual budget of organization, number of employees, geographic scope of organization, and type of nonprofit organization. For a complete treatment of the data, we must refer you to the entire report. The results of the survey, including "break-outs" by type of organization, region, geographic scope of organization, annual budget, and number of employees have been published in an 819-page report entitled Fringe Benefits & Working Conditions in Nonprofit Organizations, Sixth Edition. Copies of the report are available for $295.00 through our On-Line Order Form or from Abbott, Langer & Associates, Inc., Dept. NET, 548 First St., Crete, IL 60417 (telephone 708/672-4200; fax 708/672-4674).
Work Practices Over half (54%) have an official lunch period of one hour; 33% have a one-half hour lunch. Over one-half (57%) of the nonprofit organizations responding have an official work week of 40 hours, with about 18% having a work week of 35 hours and 19% of 37.5 hours. Almost all have a five-day week. Regarding flextime, 41% allow it on a case-by-case basis, 31% allow it for all employees, 11% for one or more departments, and 16% do not allow it at all. When overtime work and the normal work week would not exceed 40 hours, the vast majority do not allow overtime work or do not compensate employees for it, with 14% providing additional pay or time off at straight time to the chief executive officer, 21% to other administrative/professional employees, and 38% to clerical/blue collar employees. Few allow overtime at time and one-half (in pay or time off) for any employees. When overtime work and the normal work week would exceed 40 hours, the majority still do not allow overtime work or do not compensate CEOs or other administrative/professional employees for it. 19% provide additional pay or time off at straight time to the chief executive officer; 24% to other administrative/professional employees and 11% at time and one-half; and 13% to clerical/blue collar employees and 70% at time and one-half. Overall Cost of Fringe Benefits As a percentage of payroll, the predominant overall cost of fringe benefits for CEOs is between 20% and 29.9%. The same amounts hold true for administrative/professional and clerical/blue collar employees.
General Fringe Benefit Practices Regarding flexible benefit/cafeteria/Section 125 plans, 54% of respondents have such a plan, 10% are exploring one, and 36% neither have one nor are exploring one. Regarding fringe benefits for part-time employees, the practice varies widely - with the four more frequent policies (in descending order) being: not to grant any fringe benefits to part-timers; having part-timers eligible for a few fringe benefits - but prorated; having part-timers eligible for most fringe benefits - but prorated; and having part-timers eligible for all fringe benefits - but prorated. Holiday Practices The median number of paid holidays granted is 10 or 10« days annually. In addition to the basic six holidays (New Year's Day, Memorial Day, July Fourth, Labor Day, Thanksgiving, and Christmas), the paid holidays granted most frequently are: the day after Thanksgiving (in 77% of nonprofit organizations); Martin Luther King's birthday (66%); all or part of the day before Christmas (57%); President's Day (55%); all or part of the day before New Year's Day (37%); one or more floating holiday (37%); Veteran's Day (31%); Good Friday (29%); and Columbus Day (26%). When a scheduled paid holiday falls on a Saturday or Sunday, the overwhelming practice is to grant another day off. Vacation Practices The predominant practice is to require that all employees be employed for six months before a paid vacation can be taken. As to length of vacation, the predominant practice is for nonprofit organizations to provide paid vacations to chief executive officers as follows: after one year of employment - two weeks or (less often) three or four weeks; after three years - two or three weeks or (less often) four weeks; after five years - three or four weeks; and after ten years, four weeks. A similar but slightly less generous pattern applies to other administrative/professional employees and clerical/blue collar employees. Special Leave Practices The predominant practice is to not provide paid time off for illness in the immediate family, for attendance at the funeral of someone other than a member of the immediate family, military duty, personal leave, or maternity/paternity leave (except as a part of a personal leave or sick leave program). Paid time off for death in the immediate family most frequently is three days. Paid time off for jury duty is most frequently as needed (but may be minus pay received for jury duty). Insurance Practices The predominant practice of nonprofit organizations which participated in the survey is to provide long-term disability, HMO, hospitalization, major medical, dental, prescription drug, and life insurance coverage to all employees (the percentage of organizations providing coverage varying by type of coverage and usually being more liberal with CEOs and other administrative/professional personnel than with clerical/blue collar personnel). Enrollment in vision care insurance is still not predominant in nonprofit organizations. When insurance programs are provided, the predominant practice is for the employer to pay 100% of the insurance premium for the employee's coverage for all types of insurance coverage. There is a strong tendency to pay either a smaller percentage or none of the insurance premium for the coverage of the employees' dependents. When life insurance is provided, the practice regarding the amount of life insurance varies widely, but is predominantly a flat amount or equal to one year's salary for all levels of employees. About 43% of nonprofit organizations (depending upon job level) permit employees to purchase additional life insurance coverage. Sick Leave and Short-term Disability Insurance Practices Over one-half (52%) of the survey participants provide only ordinary paid sick leave. Over one-third (36%) provide both ordinary paid sick leave and short-term disability insurance. The predominant amount of sick leave earned by employees in organizations which provide paid sick leave (with or without short-term disability insurance) is 12 days annually. In over 80% of nonprofit organizations, sick leave accumulation is allowed. Where accumulation is permitted, the amount of accumulation allowed varies widely. However, the most usual practice (but not the median practice) is to allow unlimited accumulation of sick leave. The predominant practice among reporting organizations is to not allow conversion of unused sick leave to either cash or additional vacation time. Among those reporting organizations with short-term disability insurance, the predominant practice is to have a waiting period of seven days before benefits begin. The median number of days paid under these policies is 130 days. The portion of the individual's salary paid by short-term disability insurance programs varies widely. Among employees for whom a fixed percentage of salary is paid by this coverage, the median benefit paid is 60% of their salaries. A small number of policies pay a flat dollar amount or an amount which varies by job level or length of service. The predominant practice regarding the payment of short-term disability insurance premiums by the organization is for the employer to pay 100% of the premium. Retirement Practices A little more than half (54%) of survey participants have 403(b), 401(k), 457, SIP, or IRA plans for employees; a small percentage (about 7%) have pension plans (without any 403(b), 401(k), 457, SIP, or IRA plans); 28% have both; and 12% have neither. Of those with defined contribution pension plans, the median practice is for the premium to equal about 6% of the employee's salary. However, the advent of defined contribution pension plans and the addition of 403(b), 401(k), 457, SIP, and IRA plans has made the percentage of highest average earnings provided by a retirement program variable for a significant percentage of employees. The predominant practice among organizations with a 403(b), 401(k), 457, SIP, or IRA plan is for the organization to contribute an amount equal to about 5% of the employee's salary (if the employee contributes nothing) and not to match an employee's contribution. Tax-Advantaged Programs About two-thirds of nonprofit organizations have provisions for their employees to pay medical insurance premiums on a pre-tax basis. Over 40% have provisions for healthcare flexible spending accounts and dependent care spending accounts. Employee Service/Assistance Programs About 40% provide free off-street parking; another 3% pay some or part of the coast involved. The vast majority of nonprofit organizations do not provide their employees with credit unions; discounts on goods/services; incentive programs; recognition programs; suggestion programs; day care for employees' children or elderly parents; physical examinations; food service (other than vending machines); or fitness/exercise, recreation, or weight reduction programs; financial, individual or family, legal, or pre-retirement/retirement counseling; or alcohol, drug, or smoking cessation programs. Special Work-Related Expenses Regarding providing an automobile or paying a car allowance, 48% of respondents provide this to the CEO (with the vast majority of these providing full payment for this expense), 32% to other administrative/professional employees, and 26% to sub-professional employees. The predominant practice is to pay the entire subscription price for publications for the CEO and other administrative/professional employees, but less frequently for sub-professional employees. The same pattern was found for payment of association/professional society dues. The prevailing practice is to pay the entire conference registration fee, travel expenses, and room and meal expenses for the CEO and other administrative and professional employees. The practice is somewhat less common for sub-professional employees. Payment of club/social membership dues, first-class air travel, and spouses' travel expense is not common. Educational Assistance The majority of nonprofit organizations do not pay tuition for any level of employees; but when reimbursement is provided, the predominant practice is to pay 100% of tuition. Tuition reimbursement is usually not related to number of courses taken; it is usually a fixed amount per time period or some other arrangement. Reimbursement is usually limited to tuition for individual courses related to the employee's current job. Only very infrequently do nonprofit organizations pay the cost of college tuition for their employees' children.
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