Nonprofit Boot Camp

Employment & Faith-Based Nonprofits

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What You'll Learn

This skills course focuses on employment issues for religious organizations. The course begins with an overview of the Ministerial Exception, an important aspect of the First Amendment that offers certain protections for religious organizations in employment matters. This course will also introduce topics such as compensation considerations and social media policy for employees, as well as provide practical resources such as an employment self-audit and a sample employee handbook. This course will introduce you to key concepts regarding employment, help you to draft an employee handbook and create good employment policy, and provide practical steps you can take to protect your organization in the hiring, promotion, and termination of employees.

Lesson 1

Employment Self-Audit

Most faith-based nonprofit employers (“Employers”) are pleased by the United States Supreme Court’s recent opinions strengthening legal protections for religious employers. Given the alternative possibility, that reaction is quite understandable. Employers may have already begun to update their policies and practices to ensure that the organization does not inadvertently waive these protections. Now is the time to do a more thorough audit of employment practices so that Employers comply with the many applicable state and federal laws.

Lesson 2

Sample Employee Handbook for Catholic Schools

This sample employee handbook is directed towards Catholic Schools, but, with the assistance of an attorney, could be adapted to other apostolates as well. The sample employee handbook is an educational resource that can be used as a guide in consultation with an attorney.

Lesson 3

Considerations for Nonprofits Hiring Independent Contractors versus Employees

Nonprofit organizations across the country play a crucial societal role by aiding those in need. However, due to their not-for-profit ethos, these organizations often face funding and human resources constraints. To overcome these challenges, many nonprofits turn to independent contractors to obtain specialized skills and expertise in a cost-effective manner. Hiring independent contractors can be a valuable strategy, but it also comes with its own set of considerations and responsibilities that nonprofits should be aware of. In particular, different government agencies define and classify the term “independent contractor” differently; it is important to understand this distinction to ensure that your organization is not accidentally treating contractors in a way that would inadvertently classify them as employees. In this article, we explore the key factors nonprofits should consider when hiring independent contractors.

Lesson 4

When and Why Nonprofits Should Use Written Contracts With Employees and Independent Contractors

While many nonprofits and businesses frequently hire with minimal contracts, or none at all, nonprofits should consider using written contracts for employees and independent contractors as soon as they have the resources to do so. Generally, written contracts can set boundaries, establish rules, clarify expectations, and protect confidential information. The existence of written contracts can prevent several types of harm to nonprofit organizations, from employment misunderstandings to, in the worst case, litigation). This whitepaper walks your organization through the basics.

Lesson 5

Exempt vs. Non-Exempt Employees, and Why It Matters

The Fair Labor Standards Act is a federal law requiring that employees be compensated at least the minimum wage of $7.25 per hour worked and that employees receive overtime pay of at least 1.5x their normal hourly pay if they work more than forty hours in any given week. There are six categories of employees who are exempt from these requirements. For any employees that fall into at least one of these categories, their employers do not have to pay them minimum wage or overtime pay. This whitepaper walks through the components of each of the six exemptions and what they mean for your nonprofit organization.

Lesson 6

The State of the Ministerial Exception in 2026 – What Faith-Based Nonprofits Need to Know

This crucial protection allows religious organizations to make employment decisions regarding their ministers, free from the interference of secular laws including federal and state “nondiscrimination” laws that require employers not to discriminate on the basis of certain classes (often including religion, sexual orientation, and “gender identity”). Without the protections of the ministerial exception, religious organizations would be forced to choose their ministers based on secular laws and not solely on the internal decisions of the organization. While Napa Legal has published several resources on the subject in the past, it is time for a comprehensive summary of the doctrine as well as an update on the caselaw affecting application of the ministerial exception in 2026.

Lesson 7

Consider Mediation

Employment disputes are common and can quickly result in litigation. This whitepaper walks through considerations for mediation for faith-based organizations, including a sample mediation and arbitration agreement.

Lesson 8

Example Social Media Policy

Social Media is both an opportunity and a threat for faith-based organizations. Nothing deters prospective program participants or donors from involvement with an organization like irresponsible social media use does. This example social media policy educates organizations on how to use social media to further their missions, rather than cause scandal or chaos, through effective and prudent social media usage.

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