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For the Central Conference of American Rabbis Part I in a Series of II Articles |

APRIL 2020

by Michael Gan and Jean-Marc Favreau, Peer, Gan & Gisler LLP, Washington, DC

The current COVID-19 pandemic and its associated economic impacts may
affect rabbinic employment agreements in a number of ways. For example,
some congregations are asking rabbis to reduce compensation or benefits
immediately, others in anticipation of the next budget year. A few congregations
are reevaluating their current contractual relationships even where there is an
enforceable employment contract in place. Others are acting more cautiously in
contract negotiations with new or renewing rabbis.
This guidance is designed to help rabbis identify pandemic-related employment
issues and consider available options. This guidance is not a substitute for legal
Work with the Congregation and Do Your Own Homework
If your lay leadership indicates that it will be considering actions to mitigate
potential impacts to its finances (e.g., less income from dues, inability to engage
in programs that generate revenue, etc.), there are steps you can take to prepare
yourself and to work with them. These decisions should not be unilateral by lay
leadership without rabbinic input. As we discuss in greater detail in Part II of this
series, rabbis provide an essential voice in addressing a congregation's financial
challenges and you should be considered a partner with the lay leadership in dealing
with the challenges ahead. Part II will address the appropriate questions to ask as
you engage with them.
Consider Whether It Is Necessary or Advisable to
Reevaluate Your Current Employment Agreement
If your lay leadership approaches you about making changes to your existing
contract, you can take a collaborative approach without necessarily sacrificing too
much, if anything at all, especially if it will cause you long term harm.
Remember that your contract is binding and generally cannot be changed
unilaterally or nullified unless there is specific language permitting the congregation
to do so. Such provisions may include legal clauses such as "force majeure"
provisions for renegotiating salary if certain membership or financial markers
are hit, or termination without cause provisions that hopefully provide severance
If you find yourself renegotiating the existing provisions of your contract-whether
voluntarily or because the contract requires it-avoid structural changes that will
have long-term consequences. Here are a few suggestions:
a. Ensure a "shared sacrifice": The financial woes should not be borne solely
by you. Board members should be asked to step up their donations and
other professional staff must be asked for concessions as well. Remind the
congregation that you will likely be working more during this crisis (increased
pastoral duties, learning and utilizing technology to conduct business). While
challenging for many rabbis, it's also important to discuss whether other staff
may actually have significantly reduced workloads.
b. Opt for salary deferrals, not salary cuts: Suggest delaying scheduled increases
for a reasonable period of time and be creative about making it up in the
future. For example, a part of your salary deferred today can later be paid into
your pension or used to partially fund an emeritus contract.
c.If salary (sometimes called base compensation) must be cut, consider leaving
the top line number in place and identifying a portion of the salary as a "gift"
back to the congregation: This sets an example for other staff and congregants
and will otherwise be helpful in soliciting gifts from them. Be sure to discuss
such a plan with your accountant or financial adviser.
d. Try to maintain pension contributions on the original salary amount, even if
you agree to a deferral or a cut. Even a small pension reduction today will have
a significant impact at the time of retirement.

and/or tax counsel, which is recommended if your employment contract will
be modified in any way. Every congregational setting and every contract is different.
Be sure to contact a tax or legal professional before you act. The CCAR Executive Team
can also be helpful in providing guidance and help in planning, but we are not a
substitute for appropriate accounting or legal counsel.
Further, this article should be seen in context of the other articles in this
series, especially as to the ways in which finances are a partnership matter
in a sacred community and issues as to rabbi's important role in financial
e. Consider tradeoffs if compelled to make salary reductions: You could, for
example, add vacation time or additional Shabbatot off each year or request
a sabbatical to be used in the future. (Certainly this may impact different size
congregations differently.)
Whatever changes you agree to-temporary or permanent-ensure that they are
reflected in writing in clear, simple terms, and signed by you and the congregation's
Current Contract Negotiations
If you are negotiating a new or interim contract in the midst of this crisis there
are steps you can take to help things along. The main goal is to complete contract
negotiations with all deliberate speed. It does not appear that the financial impact
of the pandemic will be improving any time soon, so the sooner you can lock down
a contract, the better.
Those of you who are moving to a new area must assess any physical and practical
obstacles to moving for a July 1 start. Consider the many ways (especially with new
technologies) that will enable you to join the staff and engage with congregants
and others virtually, even if not physically present. You may also need to discuss
assistance finding rental housing when you can move or, if necessary, even help
covering the first month of rent and a security deposit.
If you have real estate concerns (e.g., selling your current house or buying a new
one) there are often out-of-the box solutions leadership can help with (such as
"passing the house" to incoming clergy or forgivable loans to help with a down
Final Considerations
These suggestions go hand in hand with Part II of this series: ensuring that financial
decisions are fact-driven, not fear-driven; looking at other sources of revenue,
including the federal loans and relief packages that may apply; and leading creative
thinking to ride out the crisis.
The impact on congregations now is likely to be different than what happened
during the 2008 recession. Unfortunately, that is yet to play out.
Meanwhile, keep educating yourself about your congregation and its finances,
about developments in the pandemic and the economy, and about resources utilized
and/or created by your colleagues around the country.
Here are some helpful resources to get you started:
1. CCAR has made coaches and consultants available to members for some
pro-bono consulting.
2. Upcoming First One Hundred Days seminar. May 6-7, 2020.
3. "Pensions: More Precious Than Ever" article

CCAR Newsletter May/June 2020

Table of Contents for the Digital Edition of CCAR Newsletter May/June 2020

CCAR Newsletter May/June 2020 - 1
CCAR Newsletter May/June 2020 - 2
CCAR Newsletter May/June 2020 - 3
CCAR Newsletter May/June 2020 - 4
CCAR Newsletter May/June 2020 - 5
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