The NonProfit Times - February 1, 2009 - (Page 15) THE NONPROFIT TIMES 2009 SALARY & BENEFITS SURVEY Health Premiums Cut Into Pay Hikes BY MARK HRYWNA T he way Brian McConnell sees it, rising healthcare costs at some point will exceed his nonprofit’s ability to provide wage increases.“I just don’t see how we can keep up with the ongoing increases,” said McConnell, who has been executive director the past six years at the Greater Steuben Chapter of the American Red Cross in Corning, N.Y. Nonprofits from around the country that responded to The NPT 2009 Salary & Benefits Survey reported wideranging increases in healthcare premiums. One nonprofit in the South expects an 18-percent spike, with the organization covering the tab. Another nonprofit, in the North Central region, expects premiums to increase by 24 percent, even after shopping around the policy for lower premiums and making changes in the benefits levels to pay for the increase. Among the highest reported increases was at a nonprofit in the North Central region, where premiums will rise 38 percent. Of the nearly 1,500 responses to this year’s survey, 61 percent expect employee health premiums to increase during 2009. Some 14 percent expect them not to increase and 16 percent don’t know, while 9 percent have no health insurance benefits. Just as many nonprofits (263) said they shopped around for lower premiums as organizations that made changes in benefits levels (262). Respondents expect an average increase in premiums of about 12.5 percent, with a high of 80 percent. The most popular way to pay for increases was splitting the cost between the employee and organization. The average share of employees’ premium increase was more than 20 percent while organizations paid an average of 52 percent of the premium increase. Headquartered in central New York near the Pennsylvania border, the Greater Steuben Chapter expects a 25-percent jump in premiums, McConnell said, with 80 percent of the increase picked up by employees. Much of the Health Premiums, page 16 FUNDRAISERS Continued from page 13 Eddy noted that in their searches in Arizona that nonprofits are “willing to pay almost anything because no one really wants to relocate there. They’re willing to go 30 to 40 percent of their original salary range because it’s hard to find good people there.” The nonprofit marketplace is still very young there, she said, because of the incredible growth in recent years. It looks like it might be a tough year for executive directors regardless of what part of the country their nonprofit is located. Average salaries, while still the highest among all 10 positions surveyed, are expected to decline in four regions led by Mid-Atlantic (-4.9 percent) and South (-3.91 percent), but in the three regions that reported increases (North Central, Southwest, West), none rose by even 1 percent. Female executive directors outnumbered males this year, but only slightly, with 51 percent, or 805 of the total 1,581 responses compared with 49 percent, or 776 males. Though the average female executive director salary will rise against a drop for the male salary, according to the survey, a female executive director’s salary still will be about 74 percent of a male’s, up from 70 percent. The overwhelming majority of nonprofits surveyed, more than 73 percent, said they don’t pay performance-related bonuses to top executives. Less than 18 percent of organizations said they pay performance-related bonuses. The proportion was similar when nonprofits were asked: If they had to recruit a new chief executive this year, “would you consider offering a one-time bonus to the right candidate?” Only 16 percent said they would offer a bonus while 43 percent said they would not; 41 percent responded that they don’t know. Harrigan of Careers In Nonprofits said some associations last year offered signing bonuses but that was in the early part of the year. After July, she said, people were “very apprehensive and not as generous.” Year-end bonuses came off the table because employers were apprehensive about what the budget would look like in 2009, she said. During the past two years, Edell of DRG has seen onetime bonuses offered more often to attract the right person or to address differences in benefits and pensions. Performance-related bonuses for top executives also are becoming more common, particularly at the CEO and development director level, he said, adding that a bonus of 5 The Utica Zoo plans to reduce expenses where it can to bring some staff salaries up to industry standards. to 15 percent of salary can be earned based on predetermined goals and objectives. Of the minority of organizations that do pay performance-related bonuses, the chief executive is most likely to get one, and get the largest, with an average of 9.62 percent of their salary. Others more likely to receive performance-related bonuses were program director, 4.88 percent; chief financial officer, 6.23 percent; development director, 6.53 percent; director of human resources, 5.6 percent, and chief of direct marketing, 5.05 percent. Least likely to get bonuses were planned giving officer, 3.43 percent; major gifts officer, 3.59 percent;Web master, 2.18 percent, and director of volunteers, 3.08 percent. Most respondents, more than 71 percent, don’t offer executives post-retirement benefits other than mandated medical coverage, such as COBRA. Less than 15 percent said they do while 14 percent said they don’t know. Of those that do offer more than what’s mandated, the most popular responses were a simple Individual Retirement Account (IRA) or Simplified Employee Pension (SEP). Some organizations said they offer the same benefits package but the retiree pays the full premium, and others offer the same program as for all employees, with medical, dental and vision. The most popular benefit offered to executives was professional development education (820 responses), life insurance (787), cell phone (776) and salary increases (716). Less popular were membership dues (529), expense allowance (447), tuition reimbursement (354) and extra vacation (353). The least popular were a performance bonus (248), car (197), severance pay (196), housing (46) and day care services (20). Among the benefits specified in 267 “other” responses were 35-percent tuition reimbursement for a child,10.5 percent of annual pay to pension, $3,000 per year for benefits, up to 6 percent match on 403(b) plan, and 0.75 percent of income toward retirement or medical insurance. Another organization said they offer a $50 allowance toward the cost of a cell phone and others offer a transportation or travel allowance. Others specified “The joy of giving!” and “wonderful job, wonderful atmosphere, flexibility.” Fewer than three of every 10 organizations have an executive succession plan in place, with 71 percent of respondents indicating they don’t. Of the organizations that don’t have a plan in place, almost half (48 percent) said there isn’t one in process. More than 41 percent have a plan in progress and another 4 percent said it’s being considered or discussed. Miscellaneous comments to the question about executive succession plans elicited perhaps some of the more candid responses, such as,“Not really – they freak when I mention such an idea!” and “No – they hope I never leave,” and “No – very scary.” Others indicated they have informal plans but “nothing in writing,” a succession plan has only been mentioned but no action, or it’s slow due to lack of time. Nonprofits don’t worry enough about talent and future talent, said Edell. If more time and money were spent on the capacity for executive leadership, the transitions “would not be quite as traumatic as they shape up to be,” he said. NPT About the respondents: The largest category among the respondents was social/welfare, with 28 percent of the total, followed by balanced splits. Health organizations made up 16 percent, followed by other purpose/government, 14 percent, and educational, 13 percent. Next was civic/culture, 10 percent; associations, 6 percent, religious, 5 percent; foundation, 5 percent, and environmental, 4 percent. FEBRUARY 1, 2009 THE NONPROFIT TIMES www.nptimes.com http://www.nptimes.com
Table of Contents Feed for the Digital Edition of The NonProfit Times - February 1, 2009 The NonProfit Times - February 1, 2009 Attorneys General Focusing On Fiduciary Responsibilities The Urge To Merge Taking Cancer To Court Contents Indefensible Calendar Special Report The Holidays Are Over Health Care Guide NPT Jobs Advertiser Index Resource Directory The NonProfit Times - February 1, 2009 The NonProfit Times - February 1, 2009 - Taking Cancer To Court (Page 1) The NonProfit Times - February 1, 2009 - Taking Cancer To Court (Page 2) The NonProfit Times - February 1, 2009 - Contents (Page 3) The NonProfit Times - February 1, 2009 - Contents (Page 4) The NonProfit Times - February 1, 2009 - Contents (Page 5) The NonProfit Times - February 1, 2009 - Contents (Page 6) The NonProfit Times - February 1, 2009 - Contents (Page 7) The NonProfit Times - February 1, 2009 - Contents (Page 8) The NonProfit Times - February 1, 2009 - Contents (Page 9) The NonProfit Times - February 1, 2009 - Calendar (Page 10) The NonProfit Times - February 1, 2009 - Special Report (Page 11) The NonProfit Times - February 1, 2009 - Special Report (Page 12) The NonProfit Times - February 1, 2009 - Special Report (Page 13) The NonProfit Times - February 1, 2009 - Special Report (Page 14) The NonProfit Times - February 1, 2009 - Special Report (Page 15) The NonProfit Times - February 1, 2009 - Special Report (Page 16) The NonProfit Times - February 1, 2009 - The Holidays Are Over (Page 17) The NonProfit Times - February 1, 2009 - The Holidays Are Over (Page 18) The NonProfit Times - February 1, 2009 - NPT Jobs (Page 19) The NonProfit Times - February 1, 2009 - Resource Directory (Page 20) The NonProfit Times - February 1, 2009 - Resource Directory (Page 21) The NonProfit Times - February 1, 2009 - Resource Directory (Page 22) The NonProfit Times - February 1, 2009 - Resource Directory (Page 23) The NonProfit Times - February 1, 2009 - Resource Directory (Page 24)
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