Oops … Do You Need to Amend Your Tax Return?

There are several reasons why an employer might encourage employees to get involved in community service and volunteer activities outside the workplace. The activities result in good public relations. It’s also good for employees’ morale and their pride in the company or organization. It may even help the employer attract and keep better employees.

So, if you want to encourage your employees to volunteer for community service, you’ll want to set out guidelines on the nature of the business’s involvement and the extent of the activities the business encourages. Here are some questions to consider:

1. How much money can you afford to spend to encourage employees to take part in volunteer education and community service activities? Deciding this will determine how much paid time you will permit employees to use, or how much in donations you will make to match employees’ volunteer time or donations.

2. Which kinds of volunteer and community service activity do you want to encourage? Some examples: Serving on local Chamber committees, participating in a United Way campaign, helping in a service club’s charitable fund drive, volunteering in a hospital or hospice, serving with a church group in a community kitchen, helping build a Habitat for Humanity house. Rather than list specific examples of approved activities and organizations, you may want to simply designate “volunteer service for any federally tax-exempt charitable, education or religious organization.”

3. What form will the company’s encouragement or participation take? Will your business match an employee’s donated time with a donation of cash? Will you match an employee’s donation of cash with your donation of cash? Up to what dollar limit? Will you give employees “X” number of hours of paid time for community service work in a year? Will you sponsor a community or charitable project and pay employees to participate?

4. What is your Workers’ Compensation liability if you encourage employees to participate in charitable and community service work outside your workplace? Check with your Workers’ Comp carrier to be sure you have protection from any liability.

5. How will you verify the employee’s voluntary activity or donation? The easiest way to verify an employee’s participation might be to design a form to be signed by a representative of the not-for-profit agency and require the employee/volunteer to return it to you. You can also coordinate directly with the not-for-profit and ask them to acknowledge participation.

Now that you’ve contributed to your community in this important way, don’t forget to acknowledge the effort of your volunteer/employees. After all, we all thrive on acknowledgement. Some companies go so far as to make volunteer work an optional step on the ladder of promotion.

It may seem counter-intuitive to good business principles to allow your staff time off to expend their energies helping someone else. However, when individuals recognize needs in the community and work to fulfill them, they become better citizens. When you give employees the flexibility to do this, your business becomes a better citizen as well. A strong volunteer program not only serves community needs, but it has the power to develop your employees’ skills and leadership abilities, enhance customer loyalty, and improve your relationships within your community. All good things!