Employee or Volunteer: What’s the Difference?

Employee or Volunteer: What’s the Difference? (downloadable pdf) by Melanie Lockwood Herman for Nonprofit Risk Management Center. Covers the legal definitions, allowable benefits, and best practices for volunteer engagement.



If your nonprofit engages both paid personnel and unpaid volunteers and paid employees are eligible to volunteer, consider the following tips to increase the safety of your HR and volunteer management practices.

  • Put it in Writing – An important step in distinguishing between your employees and volunteers is to document the distinct roles that each group of workers plays in the organization. First, make certain that you have written job descriptions for each paid role in your nonprofit. A job description should contain information on the employee’s classification and status (e.g., regular/non-exempt/part-time or temporary/full-time/exempt, etc.), education and other requirements, as well as specific job duties. Volunteer roles should be defined in position descriptions or volunteer agreements that emphasize volunteer status and make it clear that no compensation will be provided. A Volunteer Agreement* is especially helpful when the volunteer is also an employee, because it requires both the nonprofit and the volunteer to agree and acknowledge that volunteer service is separate from employment and that the willingness to volunteer will have no impact on the terms of a volunteer’s employment with the agency.
  • Document Policies in Separate Manuals – While the Center recognizes the desire to economize in developing policies, we believe it is inappropriate and risky to consolidate policies for employees and volunteers in a single handbook or manual. An Employee Handbook or Personnel Policies Manual should be developed and distributed to employees only. A Volunteer Handbook or Volunteer Policies Manual should be developed for your volunteer workforce. The overlap in policies should be minimal, such as those related to safety matters. Employees who also volunteer should be instructed that their volunteer service is governed by the policies in the Volunteer Handbook, and that their paid service is governed by the policies in the Employee Handbook. An employee who volunteers should have a job description and a Volunteer Agreement.
  • Never Ignore “Off the Clock” Service – Employers who look the other way when nonexempt workers “volunteer” after hours expose their nonprofits to costly wage and hour claims. The nonexempt employee who is content to volunteer today could be an aggrieved plaintiff demanding unpaid wages and penalties six months from now. Keep in mind that it is the employer’s duty (not the employee’s!) to keep track of the hours worked by nonexempt employees and to ensure that compensation practices are FLSA compliant. Exempt employees are expected to work the hours required to perform their jobs. Most exempt employee schedules include occasional long days and extended work weeks. The additional time spent beyond a customary eight-hour day or 40-hour work week is generally part of the job, and not “volunteer” service to the agency. If, however, an exempt worker seeks a formal volunteer role in the nonprofit he or she should be required to follow the proper channels and should be subject to the rules and supervision associated with that volunteer role.
  • Never Coerce Employees to Volunteer – An employee who feels coerced to “volunteer” after regular work hours is a wage and hour claim waiting to happen. No individual—whether they are on your payroll or not—should be coerced to volunteer their time for your nonprofit. Make certain that all supervisors at your organization are aware of the distinction between employee and volunteer status, and that they understand that strong-arming employees to work without pay is a violation of policy that may subject the supervisor to discipline.
  • Remember the Volunteer Service Rule of Three – “True” volunteers are those who: (1) work toward public service, religious, or humanitarian objectives; (2) do not expect or receive compensation for services; and (3) do not displace any genuine employees.

*Use the Center’s affordable online tool, My Risk Management Policies, to develop a custom volunteer agreement or job description (and 200+ other risk management policies) in a matter of minutes.

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