Determining When to Involve the Board in HR Matters
Nonprofit organizations must be extra vigilant when it comes to managing unexpected and often rapidly changing human resources (HR) issues. Hesitation to react can lead to dire consequences. However, reacting without meaningful contemplation can be equally dangerous. One critical consideration is how to develop guidance for discussions and messaging with Board members on changing HR issues.
I recently had a conversation on this topic with Sheila Amo, founder and CEO of The Perry Perspective, an HR consulting and coaching firm based in Annapolis, Maryland, and Washington, DC.
I shared a few developing HR issues that had escalated and caught the attention of Board members, and Amo shed some light on interacting with Boards on important HR issues. She suggested that it is best to organize your HR discussions with Boards into two categories”
“Informing the Board” and
“Involving the Board”
I find this to be very insightful guidance that helps to frame and manage discussions and messaging with Boards. Management controls the flow of information between the organization and the Board. There is a delicate balancing act between ensuring timely transparency and overwhelming the Board with needless information.
Building on Amo’s guidance, I suggest three action steps related to HR issues and Board interactions.
Step 1 – Determine whether the HR issue rises to a level that requires the Board to be informed. There are many HR issues that fall into the category of “day-to-day” operations and are the responsibility of management. In these cases, it would not be prudent nor efficient to share this information with Board members. In fact, sharing this information could encourage unnecessary micro-management by the Board. Some examples of operational matters that generally should not be share with the Board include cultivating the employee experience, enforcement of employment policies, developing and managing staff talent, and setting standard working hours.
Step 2 – If the HR issue rises to a level that the Board needs to be informed, document the issue in detail and prepare an executive memo that can be referenced and/or included in regular Board correspondence and archived in HR department files. Depending on the seriousness, it may be prudent to schedule a call as well. Make sure stringent management oversight and approval processes are in place before releasing information to the Board, as it is crucial that messaging to the Board be carefully supervised by the highest level of management. Some examples of situations that the Board should be made aware of, but don’t necessarily require their approval, could include a material change in employee benefits, termination of a long-tenured employee whose termination could impact, for example, the Board’s fundraising efforts and discussions with donors, and elimination of a staff position.
Step 3 – Determine whether the HR issue rises to a level that requires direct Board member involvement. By nature, these situations are the most important and sensitive, so special care must be exercised. As in Step 2, documentation and coordination with the HR department are important, along with more comprehensive actions such as seeking legal counsel when necessary and developing alternative plans of action for Board consideration. Examples here tend to be more serious including termination of an executive level staff member, strategic actions to address diversity, equity, and inclusion, and other significant HR issues.
Planning Tip – Informing the Board about HR issues is important but can lead to mistakes if not handled carefully. It is best to hit the pause button to make sure you have the facts straight and a thoughtful recommended course of action before informing the Board. Keep the pause as short as possible because HR issues usually need to be addressed quickly. If the situation is highly volatile like employee fraud, time is of essence. Inform the Board right away and let them know that you are working on a course of action pending the completion of due diligence and fact-gathering procedures.
Assume that HR issues are always sensitive in nature, so proceed with caution when discussing HR issues with Boards. However, caution does not mean hiding or overly delaying. Using Amo’s approach of assessing whether the situation falls into the category of informing the Board or involving the Board will help you to determine how to structure your message and frame your recommended course of action.
