“Our organization wants to hire a new person. How do we decide a salary for this position?” We’ve received this question from many nonprofits wanting to expand their staff. While many nonprofit employees are mission-driven and passionate about their work, setting the right level of compensation is important to our ability to recruit and retain talented employees. Here are some recommendations from CNS.

Where to Start
Tax-exempt nonprofits, like all other employers, are required to follow federal and state wage and hour laws that require employers to pay at least minimum wage. In Oregon, the minimum wage is different depending on your location. Refer to the Oregon Minimum Wage Rate Schedule for details. At the higher end of the pay scale, compensation must be “reasonable” and not “excessive,” which is a fundamental requirement of maintaining tax-exempt status.

Of course, you will also need to consider your organization’s budget and how much income you have to devote to a new employee. After reviewing the sources below, you can use this number to help you determine how many hours, or a range of hours, your organization can afford.

A Frame of Reference Can Help
We recommend reviewing postings for similar jobs on Indeed, Craigslist, Mac’s List, Idealist, and other job posting websites to see the compensation being offered. You can also check the national Bureau of Labor Statistics for statistics from Oregon as of May 2017.  The state’s Employment Department website will allow a deeper look into Oregon’s statistics by region.

Available Data and Reports
There are also some helpful reports specific to Oregon’s nonprofit sector, such as:

We hope these resources are helpful in determining compensation ranges for your nonprofit. Don’t forget to also factor in the cost of living in your specific region, the size of your budget, and the type of service your nonprofit provides.