Post by Admin on Dec 9, 2016 23:05:42 GMT -5
At Christmas time, I always come across the articles written by lawyers on the question of awarding Christmas bonuses to employees. Usually, this is relative to condos, which have different laws than HOA's and cannot always be extrapolated to HOA's. For purposes of the following factual comments, SLohA is considered to be a not-for profit corporation only since it has no Covenants.
It is my understanding that a Christmas bonus has always been incorporated into SLohA's employee compensation package. This year, I am told, SLohA is "clubbing" employees potentially by begging donations from Clubs! It is asking CLUBS to pay employees a bonus and whining that the high legal fees are precluding payment by SLohA this year!
This is an outrage and an insult to hard working employees who are being treated unfairly by a management that seeks to propagandize its supposed poor financial condition on exhorbitant legal fees which it caused. Management is crying "poor mouth" owing to THEIR decision to break the bank on legal fees! Our employees, who have been repeatedly called out for their service "above and beyond" the usual job tasks are being penalized for Management's self-serving decisions and subjected to the uncertainty of the ability and willingness of Clubs to pick up the slack for Management!
The Association has always paid a Christmas bonus to employees and should continue doing so without involving the clubs' recreational business in its administrative business. Frankly, I am shocked that the Board would permit the management company to solicit funds from clubs for this purpose.
Shame on you Stmbug Ixx!
Shame on you BOD!
The best practices advocated by FL attorneys regarding Christmas bonuses to Association employees is that the board should get membership approval that bonuses (above payroll) be incorporated into the compensation package. The board should ratify and approve the use of owner funds for bonuses that are not included in payroll packages. Employees are typically hired with a "promise" of salary and bonus and HOA boards should act consistently with the employment offer, its bylaws and policy. The attorney summary is stated:
This is the law according to FS617 on not-for-profit corporations. This is the law that currently governs corporate business in the absence of Covenants. Here are the conditions that permit SLohA to pay its employees.
If SLohA accepts donations from owner clubs to pay bonuses to its employees, it must be declared as INCOME and could change SLohA's tax exempt status.
It is my understanding that a Christmas bonus has always been incorporated into SLohA's employee compensation package. This year, I am told, SLohA is "clubbing" employees potentially by begging donations from Clubs! It is asking CLUBS to pay employees a bonus and whining that the high legal fees are precluding payment by SLohA this year!
This is an outrage and an insult to hard working employees who are being treated unfairly by a management that seeks to propagandize its supposed poor financial condition on exhorbitant legal fees which it caused. Management is crying "poor mouth" owing to THEIR decision to break the bank on legal fees! Our employees, who have been repeatedly called out for their service "above and beyond" the usual job tasks are being penalized for Management's self-serving decisions and subjected to the uncertainty of the ability and willingness of Clubs to pick up the slack for Management!
The Association has always paid a Christmas bonus to employees and should continue doing so without involving the clubs' recreational business in its administrative business. Frankly, I am shocked that the Board would permit the management company to solicit funds from clubs for this purpose.
Shame on you Stmbug Ixx!
Shame on you BOD!
The best practices advocated by FL attorneys regarding Christmas bonuses to Association employees is that the board should get membership approval that bonuses (above payroll) be incorporated into the compensation package. The board should ratify and approve the use of owner funds for bonuses that are not included in payroll packages. Employees are typically hired with a "promise" of salary and bonus and HOA boards should act consistently with the employment offer, its bylaws and policy. The attorney summary is stated:
A bonus is permissible, even one based partly on net earnings, if the employee's entire compensation package is reasonable and in furtherance of the organization's exempt purpose.
This is the law according to FS617 on not-for-profit corporations. This is the law that currently governs corporate business in the absence of Covenants. Here are the conditions that permit SLohA to pay its employees.
If SLohA accepts donations from owner clubs to pay bonuses to its employees, it must be declared as INCOME and could change SLohA's tax exempt status.
A 501(c) tax-exempt organization may award a bonus to an employee if the employee's total compensation package:
Is established by an independent board of directors or by an independent compensation committee;
Is reasonable in terms of the employee's specialty and geographic locale;
The result of arms' length bargaining;
Includes a ceiling or reasonable maximum;
Does not have the potential to reduce the charitable services or benefits the organization would otherwise provide;
Takes into account measures of the employee's performance;
Keeps the organization within budget without charging more for services;
Does not transform the principal activity of the organization into a joint venture between it and the employee;
Is not merely a device to distribute all or a portion of the organization's profits to persons who are in control of the organization;
Serves a real and discernable business purpose of the exempt organization;
Does not result in abuse or unwarranted benefits; and
Rewards the employee based on services the employee actually performs.
Is established by an independent board of directors or by an independent compensation committee;
Is reasonable in terms of the employee's specialty and geographic locale;
The result of arms' length bargaining;
Includes a ceiling or reasonable maximum;
Does not have the potential to reduce the charitable services or benefits the organization would otherwise provide;
Takes into account measures of the employee's performance;
Keeps the organization within budget without charging more for services;
Does not transform the principal activity of the organization into a joint venture between it and the employee;
Is not merely a device to distribute all or a portion of the organization's profits to persons who are in control of the organization;
Serves a real and discernable business purpose of the exempt organization;
Does not result in abuse or unwarranted benefits; and
Rewards the employee based on services the employee actually performs.
