Could your charity or its staff be liable to prosecution by the Fair Work Ombudsman? Paul Tavatgis, Chief Executive Officer at the PFRA, explores what could happen when charities fail to get their compliance right.
I recently wrote in F&P about how important it is to get compliance right when charities outsource face-to-face fundraising. The recent announcement by the Fair Work Ombudsman of an investigation into charities and their fundraising supply chains makes this requirement more urgent and more important. This was reinforced by the coverage this weekend relating to mistreatment of fundraisers and the initiation of a class action into one of Australia’s biggest fundraising agencies.
The sector has a responsibility to ensure that face-to-face fundraisers are treated with respect. They are the people who probably speak to more donors than any others; they also carry out difficult and critical work for our sector, which charities can’t afford to lose. Bad treatment of fundraisers is just not on – and the sector has an urgent job to do to fix this.
The charity always carries responsibility
In this article I hope to explain the issue in more depth and provide charities with some practical advice on how to meet their obligations in what can be a complex and confusing environment. Failure in this area can potentially lead to charities and individual members of staff finding themselves liable to prosecution by the Fair Work Ombudsman.
The focus for the Fair Work Ombudsman investigation and also an active campaign by the labour movement is alleged worker exploitation within fundraising. This is also something of interest to media – and is not just within fundraising but an issue in other sectors too.
Nationally, there is a real focus on worker exploitation and fundraising is now subject to intense regulatory and media scrutiny. Our sector needs to get its house in order if it is to retain public trust and confidence in fundraising.
We talk about ‘supply chains’ within face-to-face fundraising because the majority of this work is outsourced by charities to professional fundraising agencies. Some of the agencies then sub-contract this work to other companies which then engage independent contractors of their own. Some agencies and charities employ their fundraisers directly.
The key fact to remember is that it doesn’t matter how many layers there are in between a charity and the fundraiser on the street or at the door – the charity still carries responsibility for making sure that workplace laws are complied with. You can outsource the work but you can’t outsource the responsibility.
Responsible supply chain management
Due diligence can be complicated for charities using outsourced face-to-face fundraising. Workplace law, especially as it relates to independent contracting, is complex. Also the nature of the market for face-to-face fundraising – where demand far exceeds the available supply – can make it difficult to ask suppliers hard questions. This shouldn’t stop charities from taking basic steps to ensure that suppliers are compliant. Suppliers also need to understand that charities have to ask these questions, and they should be prepared to cooperate.
Charities need to show ‘responsible management’ and apply proper oversight of their supply chains. This means charities should have a detailed understanding of how suppliers comply with workplace laws. It is not enough to hide behind an outsourcing arrangement – just because you have a contract that requires compliance is not enough to meet your obligations.
Basic steps in due diligence should include a supplier appointment process that requires evidence of compliance. Charities should also have a sound understanding of how their suppliers engage fundraisers and whether the supplier has experienced any compliance issues in the past. It is also critical for a supplier to be able to show that they have the processes and systems in place to ensure compliance.
Importantly, it’s ‘not what you say but what you do’ that is most critical for compliance, particularly when suppliers engage independent contractors. A supplier can have the best paper system in the world but if its real-world actions don’t follow the system, then it risks being found to be non-compliant.
Due diligence checklist
The PFRA has a detailed due diligence checklist available for members. This is a great tool for asking all the important questions. It’s not enough to ask the questions, however: if the answers raise issues, charities need to follow through on these. It may even be necessary to conduct a compliance audit. Importantly, remember that only an audit conducted by a lawyer will be subject to legal privilege.
The PFRA will also be introducing a compliance checking process to ensure that all members have the proper processes in place to protect fundraiser health and safety. These are also key areas for charities to ensure that agency partners are operating effective systems.
If you outsource any aspect of your fundraising, you can’t afford to ignore these issues. It’s not enough to rely on assurances from your suppliers of compliance, you need to ‘inspect don’t expect’. There are resources available to help with this; take advantage of them. When charities decide to work with fundraising agencies, they look for passion, expertise and skill. We just need to make sure that “compliance” is also on that list of must-haves.
Paul is the Chief Executive Officer of the PFRA. For more information about the PFRA and membership for your organisation, email Paul at firstname.lastname@example.org.
Image courtesy of anankkml at FreeDigitalPhotos.net.