One of the things I am most thankful for this Thanksgiving season is the relationship I have with my friends at MAG Bookkeeping. Led by Bryan Miles, his wife Shannon and Randy Ongie, this is the best organization I know to assist your church with its bookkeeping needs. You can learn more about MAG by clicking HERE or on the image to the left.
Recently, they wrote an insightful post on how churches approach the issue of compensation. I wanted to pass their thoughts along to you.
The following are 5 Compensation Philosophies Used For Church Staffs brought to you by the team at MAG Bookkeeping:
Previously we’ve established just how much you as a church really should be spending on staffing expenses (make sure you read this), you need to start developing a plan for how you spend those staffing dollars. We call it a “compensation philosophy” – which is just another way to say that you’ve determined, strategically and in full cooperation with your church leadership, how you’re going to determine what you pay the people on your staff.
Here are a few approaches we’ve seen churches around the country use to establish their compensation philosophy:
- Internal equity – staff members with roughly equal responsibilities get roughly the same salary
- External equity – staff members are paid approximately what others in the community are paid for the same position
- Family size – the more dependents a staff member has, the higher the salary (this philosophy isn’t very widely used, but it is an option we’ve seen.)
- Seniority – the longer a staff member has been employed or doing this type of job, the more salary dollars assigned
- Locality – basing salaries on the average incomes in your area (If you’re in a lower-income area but choose to pay your senior pastor the average salary for senior leaders across America, you may be setting that leader up unfairly without knowing it.
These types of scenarios are the ones church leaders need to be thinking about when it comes to deciding how you’ll pay your staff. And you need to think about it, and not just react and pick a number out of the air when you find yourself making a hire.
Once you’ve settled on a compensation philosophy, you need to write out what you’ve chosen to do and how it will play out on your staff. If you don’t state your philosophy, then everyone will assume you’re doing and thinking the same things they are, and that probably wont’ be the case. Write out your philosophy, make sure you can explain it to your leaders, then have your church governing body approve it. Once you do, everyone will be on the same page and ready to make well-informed decisions the next time a staffing decision comes to your table.
Does your church have a compensation philosophy? If so, how did you develop it?
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