When entering into full-time ministry, it’s important to understand terms like theology, exegete, doctrine, expository, eschatology, and even hotly debated topics such as complementarianism vs. egalitarianism or Calvinist vs. Arminian. But what about terms like onboarding, offboarding, employee handbooks, or benefits packages? Then there are compliance issues like pay practices, I-9, W-2, 1099, housing allowance, and state compliance obligations like increases in the minimum wage and AB 506 in California. The church I started my ministry career didn’t have a Human Resources department; we were, and still are, too small. But it didn’t take long before we began bumping up against HR issues that required experience.
The Iceberg Ahead
Like most people navigating a career change, I knew there was a steep learning curve ahead of me, but the HR portion was like an iceberg floating in the distance. What I could see was just a small tip, but in reality, something massive lurked beneath. Thankfully, the biggest challenge at first was completing some essential new hire paperwork. Gradually, as we moved closer to the HR iceberg – voluntary and involuntary terminations created a slew of questions like when is the final pay due, how a housing allowance fits into severance, who does the exit interview, what about terminating benefits like insurance, etc. It was clear we needed to learn a lot. Thankfully, there were experienced HR professionals at our church that were willing to volunteer and guide us through these issues.
The Investment of Time
Large organizations often employ a team of HR professionals and corporate counsel to guide and shape policies and practices to prevent the organization from falling out of compliance and becoming vulnerable to fines or worse. Small churches usually don’t have the kind of financial resources necessary to hire one HR professional, let alone a team. Since my initial encounter with HR-related processes and procedures, we’ve relied heavily on the expertise of professionals who volunteer their time, and we invest our time in learning what’s legal, compliant, and best practices – a lot of our time. I’ve spent countless hours reading blogs, attending webinars, seeking professional advice, and often left wondering if I’m doing it “right.” That’s just research hours; what about the hours spent onboarding a new hire? Or the investment of time to ensure we treated exiting employees fairly by compensating them accurately and timely. When California Assembly Bill 506 passed, there was a huge learning curve for our church to comply with the law. Each church in this position must ask whether this is sustainable.
Time is Money
Long before I started my full-time ministry career, I adopted a co-worker’s saying – is the juice worth the squeeze? Meaning is the amount of effort put into whatever it is that we’re doing worth the result we get from that effort. Before you send a bunch of angry mail reminding me that Jesus left the 99 to go after the 1, I agree; the juice was worth the squeeze. But, for churches with a small staff where employees often wear multiple hats, how many hours is acceptable to invest in one facet of the overall picture that is constantly changing, evolving, and increasingly complex? As I continue to wrestle with this issue, I wanted to share a simple formula that may help you to decide if it’s time for your church to investigate outsourcing HR.
- Determine the average monthly hours spent on HR-related issues: onboarding, offboarding, compliance, handbooks, policies, benefits, etc. Remember to include the hours of research via blogs, webinars, and consultants.
- Calculate the hourly rate for the employee(s) currently performing the work. (Include taxes, health benefits, retirement, etc., when calculating the actual hourly rate.)
- Compare the cost to that of a professional HR outsourcing solution.
When obeying the call to go into full-time ministry, it can be hard to imagine the amount of non-ministry administration required to keep the church safe, compliant, and financially viable. Don’t become lulled into thinking the small piece of ice in the distance doesn’t pose a threat. It could be an HR iceberg requiring attention.
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