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Are our directors allowed to be employed as a salaried officer

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  • Are our directors allowed to be employed as a salaried officer

    Hi
    This is a clause from the bylaws of our foundation. it s not quite clear to us to understand if directors are allowed to be employed as a salaried officer ?

    The Directors shall serve as such without remuneration and no Director shall directly or indirectly receive any profit from his position. A Director may be paid reasonable expenses incurred by in the performance of their duties. Nothing herein contained shall be construed to preclude any Director from serving the corporation in any capacity, other than as a Director of the corporation, and receiving compensation therefore.

  • #2
    Re: Are our directors allowed to be employed as a salaried officer

    I wish to inform you that as clause says that directors can work in any other capacity thus director may work as an employee in other capacities. Further clause says that compensation for other work may be received thus compensation may be claimed for performance of functions other than director.

    AFF

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    • #3
      Re: Are our directors allowed to be employed as a salaried officer

      I agree that is what it is says - and that is legal and common.

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      • #4
        Re: Are our directors allowed to be employed as a salaried officer

        So at our local nonprofit recreation club, the director is also a gymnastics instructor there,

        I guess that is ok and not so unusual? It seemed to me to be a little bit of a conflict of interest.

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        • #5
          Re: Are our directors allowed to be employed as a salaried officer

          It is not illegal if the corporate documents allow it.
          Of course the person still must exercise reasonableness, and his actions are subject to review by the shareholders, officers, Board members, and the IRS.

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          • #6
            Re: Are our directors allowed to be employed as a salaried officer

            Generally, most non profits operate with major employees serving on the board for no extra remuneration. Their perspective can be valuable as they are engaged in the day to day operations. Outside directors can usually be had also, however most receive remuneration and their value is questionable depending on their fit with the organization. Foe example Chelsea Clinton id a director for a non Clinton company. Her qualifications are that she was a teacher hired under influence, she gets a salary from the Clinton foundation for not making charitable works with most of the money, she is a mommy and most importantly her husband parents have been convicted of political theft in office, her mother and father should have been and her husband ran his investment company into bankruptcy. How one could see value in her qualifications as aside from being a family agent is beyond me.
            Due to a recent promotion, I should now be referred to as Major Obvious.

            I would not be trying to provide information and knowledge if I did not sympathize.

            Some days it is just not worth chewing through the restraints to face life.

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            • #7
              Re: Are our directors allowed to be employed as a salaried officer

              This entire nonprofit area is a little questionable sometimes, and you just have to watch what's happening and if there's anything unusual reported to authorities.

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              • #8
                Re: Are our directors allowed to be employed as a salaried officer

                It also pays to make sure good auditors are closely watching everything.
                At all times.

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                • #9
                  Re: Are our directors allowed to be employed as a salaried officer

                  One of our directors of our small nonprofit is also a VP,
                  From what I see above that should be okay, is that right?
                  Thank you for any comments!

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                  • #10
                    Re: Are our directors allowed to be employed as a salaried officer

                    Yes they normally can be both. Unless your by-laws say otherwise.
                    Read carefully the posts above and confirm your own facts with legal counsel!

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                    • #11
                      Re: Are our directors allowed to be employed as a salaried officer

                      But make sure to read all your corporate documents. Some founding documents prohibit the holding of two positions like that.
                      The standard forms allow it.

                      tj

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