employee benevolence program

Employee benevolence programs: What are they, and why do they matter?

More and more for-profit companies are realizing the benefits of establishing an employee benevolence program, but what exactly is it, and why is it becoming popular?

Often limited to communities of faith or service organizations, benevolence finds its place in the corporate setting by filling gaps for employees who face financial hardships that might not qualify for other types of assistance.

In this article, we’ll take a closer look at what employee benevolence programs are, why they’re needed, and how you can get one up and running.

What are employee benevolence programs?

At the heart of employee benevolence programs are people helping people.

Because your organization is not just a business, but also a community, your people are uniquely positioned to help one another. When you make the choice to establish an employee benevolence program, you provide your employees with a platform and opportunity to help each other in ways that might not be possible without their connection to your organization.

Employee benevolence programs establish a fund that provides financial relief to employees facing financial hardships. Powered by tax-deductible donations from companies and their employees, employee benevolence programs are charitable vehicles through which employees are able to apply for emergency support as well as actively contribute to the needs of their co-workers.

Why they’re needed

In the middle of a crisis, it’s very difficult to make proactive or methodical decisions because emotions and matters of urgency get in the way. Ideally, you would have plans, processes and support structures in place to minimize any workplace disruptions.

Most businesses prepare for operational stressors (e.g., an economic downturn, supply chain issues, etc.) and draft business continuity plans for a variety of these scenarios. But business leaders may not always plan for times when their employees might be personally facing a crisis.

Employees are obviously a major part of how, and how well, a business operates – so personal crises may become major disruptors, too. Employee benevolence programs can help address this liability by offering assistance with personal needs that otherwise may have a ripple effect on your business.

Consider the alternative. If you don’t have a benevolence program in place, employees often scramble to help co-workers facing a sudden crisis. GoFundMe accounts may get established without considering the tax implications for the beneficiaries. Little thought may be given to matters of privacy or precedent. And if employees who aren’t very well connected go through hard times, their needs might go unnoticed and unaddressed despite your staff’s general willingness to help.

Under a corporate benevolence program, needs can remain confidential, and aid is distributed more fairly. Having a program established before an employee experiences a crisis arms your staff with an immediate and structurally sound way to help their co-workers.

How to start an employee benevolence program

Follow these steps to set up an employee benevolence program that can grow, thrive and support your employees when they need it most.

1. Choose a nonprofit partner

It isn’t best practice for employers to be in a decision-making role when an employee comes forward with a request for financial support. That’s why finding a nonprofit partner that specializes in employee benevolence programs is a crucial first step when creating your fund.

An experienced program partner will:

  • Work with you to set your program guidelines
  • Track donations to the fund
  • Process your employees’ requests for aid
  • Manage the distribution of funds

Your nearest community foundation may have experience in corporate benevolence and is often a good place to start your search for the right nonprofit partner.

2. Develop the program guidelines

A set of guidelines should govern how your employee benevolence program operates. Your nonprofit partner should work with you to develop these guidelines, which would typically address:

  • What situations qualify an employee to receive help (e.g., natural disaster, life-threatening illness or injury, catastrophic circumstances)?
  • How many times may an employee apply for a grant?
  • What will the fund cover (e.g., mortgage payments, rent, utilities)?
  • What won’t the fund cover (e.g., credit card payments, legal fees)?
  • Are there any dollar limits?
  • How are funds distributed (e.g., through direct payments to third-party vendors)?

With a clear set of rules to direct decision-making, your employee benevolence program can operate smoothly and equitably.

3. Finance the fund

Most companies start an employee benevolence fund with a tax-deductible contribution.

If you’re already donating to local charities, you may choose to redirect a portion of those contributions toward your employee benevolence program.

After this initial gift, the long-term strategy is typically for employee donations to sustain the program. However your organization may continue to contribute through an annual gift or employee donation match.

4. Promote the program

Tapping into your marketing resources, you will need a plan for creating awareness about your program and educating your employees on how the fund works, how to make a gift and how to apply for assistance.

Long-term program management

After setting up an employee benevolence program, there are certain responsibilities you must manage as an employer to keep it running successfully.

  • Be the program champion: Commit to regular communication with your employees about your program and its benefits.
  • Run an annual campaign: Create ongoing engagement and awareness of the program with a campaign that also reminds employees how to donate.
  • Invite employees to share their stories: Help employees who have benefited from the program share testimonials if they would like to (this can coincide with your annual campaign).

People helping people

Employee benevolence programs are a unique way for employers to reinforce the values of compassion, empathy and generosity within their organizations.

For employers who want to do more for the people who faithfully do so much for them, employee benevolence programs can be a meaningful culture-add. Along with getting help to those facing an unforeseen personal crisis, starting an employee benevolence program will let all of your employees know they’re valued and that you care about their well-being.

Want more tips on creating a culture where your employees feel supported and can thrive? Download our free magazine: The Insperity guide to company culture.

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