Employee Benevolent Funds

awilliams

A subscriber to Benefits and Compensation Law Alert asked me to post the following question:

I would like to know if you know of any companies that have set up an
employee benevolent fund- This would be a fund that employees would
contribute to on a weekly basis, our president matches the contributions,
and the employees elect a board (their peers)- they (board)also decide on $
amount to whoever is in need. We are looking for guidlines, etc....


If any of you have any experience with such a fund, please post your reply here. This is a new one for me, so I am very interested to hear what you all have to say.


Anne Williams
Attorney Editor
M. Lee Smith Publishers, LLC

Gillian

I can fax some material if you would like. We put together a policy some time ago which would allow donations of sick leave into a fund which could be used by others based upon financial need. The policy didn't go into effect since the Board of Trustees didn't want an official policy (we still have the unofficial one) but I retained it so that we can try to make it official again at a later date.

Down_the_Middle

At my former employer, we had an Employee Crisis Fund that was used for ee's to obtain cash for catastrophic life events. Employee's contributed to the fund via P/R deduction and ee's applied for assistance and then were subject to an interview by employee committee members to research the request. Max amount of assistance was up to $750/yr and was normally for such things as: electricity about 2/b shut off; eviction from home or ap't; fire; etc........ Process was very easy for ee's to access and pursue w/o red-tape and obstacles. We frequently authorized the cash assistance within 1 day...

Cxjo

This type of thing just gives me the shivers. (and not in a good way) I have worked for several very caring, non-profit and spiritually based organizations and at both entities we had a benevolent fund. One was called the "Sunshine Club" and the other was just the "Employee Fund". At both companies, the best intentions led to more problems that they solved.

The problems arose when 1. employees wanted/needed to access the funds for problems that they didn't want the whole world to know about - i.e. it's sort of embarassing for someone to admit their electricity is being shut off because they didn't pay their bills 2. some employees had the GALL to complain about how "so-and-so" got $xxx and I only got $xx" 3. employees began to submit all sorts of things for emergencies - cash to replace the cash they "lost"; replacement for funds they spent on lottery tickets, oil change for car, etc. 4. the list of regulations and parameters we found ourselves setting in place began to get way too long for what should have been a fairly simple process

At Company A we eliminated the "Employee Fund"; at Company B we changed the Sunshine Fund and made it very specific as to what it would cover: 1). emergency food certificates for employees on a leave longer than 8 weeks or other mitigating circumstances such as fire burning down house and 2). we held a Xmas gift sale for employees - we used the funds to buy new toys and gifts and resold them to employees at half-price (and the CEO detested this xmas sale but we kept it going as it was one of those things that had been in pace for about 15 years).

Rockie

I can see the issues you have with abuse. We have, as I am sure every organization has, groups of employees who know how to work the system and take advantage of every single "freebie" they can get their hands on, whether they need it or not.

When Bill Clinton pushed the OSHA regs thru right before he left office, you would not believe the memo we got from an employee stating the reasons behind her request for a new $1500 chair.

Also, when the education lottery was passed in South Carolina, you would not believe the employees who tried to get assistance from our Tuition Reimbursement as well as the lottery assistance. (We ask that employees report assistance from other agencies before we approve).

There is a lot of good that can be done with an employee assistance fund, but the headaches you will get from this faction of employees will not make it worthwhile. What we do is, we just confidentially take up a collection for employees who have problems. We don't advertise what the issue is (most employees know) and the money is just given confidentially to the employee to help with whatever their issue is. In our group, this has worked out well. The people who want to give are free to give - nothing is advertised as to how much is given.

As with most things like this - they start with good intent, but end up being abused by those who least need it.