VOLUNTEER LEADERS SUMMIT 2015 NOVEMBER 19 21 2015

VOLUNTEER LEADERS’ SUMMIT 2015 NOVEMBER 19 -21, 2015 | WASHINGTON, DC WEBCAST – MARCH 20, 2015 FUNDAMENTALS OF NON-PROFITS 2015 SHRM VOLUNTEER LEADERS' SUMMIT Jon Decoteau Henry Hart Elizabeth Bille Lynn Shotwell Melissa Foldvary 1

2 What you don’t know could hurt you • Areas of potential liability for volunteers of chapters and state councils – How to keep the bad at bay – Protecting yourself from future liability • Copyright and trademark – Using music, the brand Affiliate Of logo properly • Keeping up with SHAPE – What is required in 2016 and what will the super easy, super slim, no hassle SHAPE look like in 2017 2015 SHRM VOLUNTEER LEADERS' SUMMIT

3 Your Volunteer Role Helps to Build Competency in Our HR Profession 2015 SHRM VOLUNTEER LEADERS' SUMMIT 3

SHRM VOLUNTEER LEADERS’ SUMMIT | 2015 On the way to the board meeting……. . • The Chair of the Woeisme SHRM Chapter called an emergency Board of Directors meeting to discuss a recently discovered funding shortage. • The meeting commenced with the usual three rounds of drinks. Eventually, the Chair started the business portion of the meeting by announcing that he had just discovered that the Chapter checking account was over-drawn, and was inexplicably $40, 000 less than it should have been. He further stated that there was currently insufficient funds to pay about $15, 000 worth of outstanding checks, an outstanding $10, 000 loan, and about $5, 000 of federal employment taxes which had been withheld from employees. • The Chair explained that under Board policy, the checkbook had been under the full control of the Treasurer, who had written all checks and was the sole person who reviewed all bank statements. Some of the questionable checks were over $5, 000, but there was no dual signature requirement for checks over a specified dollar amount. When the Chair discussed the matter with the Treasurer, the Treasurer had assured the Chair that the Treasurer would look into the matter, but that he and his girlfriend were headed to Tahiti for a brief vacation and that he would be unable to make the meeting. 2015 SHRM VOLUNTEER LEADERS' SUMMIT 4

5 What are some of the issues? 2015 SHRM VOLUNTEER LEADERS' SUMMIT 5

6 Tips for the Chapter and State Council Leader • Exercise due care; PREPARE for Board meetings; document in minutes that Board has closely reviewed financials and other matters approved by the Board. • Make sure that when you rely on reports of officers, committees, CPAs, or consultants, you have a reasonable basis to conclude that they are qualified to provide such reports. • Avoid director conflicts of interest; if they do exist the conflicted director should disclose and not vote or participate in discussion of the issue other than to answer questions concerning the conflict of interest 2015 SHRM VOLUNTEER LEADERS' SUMMIT

7 How to limit your liability State Laws -Many jurisdictions include in their Non-Stock Corporation Act, or elsewhere in the state code, limitations on liability of volunteers of certain non-profit organizations. Take these steps • Identify Applicable State Law • Review the Federal Volunteers Protection Act • Apply and ensure you meet the “Prudent Man Standard” – good faith; – with the care an ordinarily prudent person in a like position would exercise under similar circumstances; and – in a manner the director reasonably believes to be in the best interests of the corporation. 2015 SHRM VOLUNTEER LEADERS' SUMMIT

SHRM VOLUNTEER LEADERS’ SUMMIT | 2015 Meanwhile at the board meeting……. . 8 • Upon hearing this information, one of the Directors suggested that they have another round of drinks. Another Director noted that the Director making this motion was obviously intoxicated and should probably not be given another drink. However, the consensus was that they were all “big boys and girls” and could decide when they could or could not have another drink. • Another Director, Jessie Defamatory, said that she had no doubt that the Treasurer had stolen the money, because he was a known philander and a crook. • Having heard this information, the Chair moved that they throw the Treasurer out of the chapter, and this motion was passed unanimously without debate. • Another Director then stated that his second cousin once removed was a lawyer and had told him once that you could get insurance for these types of incidents. The Chair confirmed that the chapter had property insurance on its building, but no other insurance. 2015 SHRM VOLUNTEER LEADERS' SUMMIT

9 What are some of the issues? 2015 SHRM VOLUNTEER LEADERS' SUMMIT 9

10 Defamation – when gossip turns to liability • What is defamation – – Written (libel) or verbal (slander) statement Which is published to a third party (think something as simple as a text) Which injures another’s reputation, and Which is untrue • Defenses – Statement is in fact TRUE, or – Qualified Privilege – If it applies defendant prevails if no malice 2015 SHRM VOLUNTEER LEADERS' SUMMIT

11 Tips for the Chapter and State Council Leader Be careful and fair. When making written or oral comments which could harm the reputation of another person. 1) Make sure there is a chapter business need for such statement to be made; and 2) Only make the statement to those who have a chapter business need to hear it. • Particular areas to be careful: – Allegation of ethical violations. – Membership discipline or expulsion – Discussion at chapter meetings or on bulletin boards about vendors to the HR profession. 2015 SHRM VOLUNTEER LEADERS' SUMMIT

12 Now…. . what about the booze? Alcohol at state council & chapter events 2015 SHRM VOLUNTEER LEADERS' SUMMIT

13 Tips for the Chapter and State Council you need it? Is it appropriate? Leader • Do (i. e. student programs? ) • Use a trained server • Arrange for available alternate transportation • Use drink tickets to dissuade abuse • Check chapter insurance policies 2015 SHRM VOLUNTEER LEADERS' SUMMIT 13

SHRM VOLUNTEER LEADERS’ SUMMIT | 2015 14 As a board – pay attention to these legal issues • CAN-SPAM • Antitrust • Failure to pay Employment Taxes • NO Inurement of benefit to members 2015 SHRM VOLUNTEER LEADERS' SUMMIT

LEGAL ISSUES CAN-SPAM Act of 2003 15 What is CAN-SPAM? • E-mails of a promotional nature that advertise a product or service. For example fee-based meetings and events • Doesn’t have to be “bulk” – any number of messages – even to just 1 person • Applies EVEN IF you have a business relationship with recipients (members), the law still applies • An e-mail to chapter members advertising or promoting sale of a chapter product or service will be treated as a covered commercial e-mail message. “Transactional Messages” are excluded such as a confirmation of a commercial transaction that the recipient has previously agreed to enter into with the sender, such as payment of dues 2015 SHRM VOLUNTEER LEADERS' SUMMIT

16 w o l l a t s u T: m N A S T AIL t” R O EM u P o t M L “op I A I C y to R E lit i M b M ea O C h t L L A 2015 SHRM VOLUNTEER LEADERS' SUMMIT

17 Antitrust Principles for Specific Activities of SHRM Chapters and Councils • • • Consultants Prices Membership Discipline Services to Non-Members Surveys of prices, wages, or significant costs 2015 SHRM VOLUNTEER LEADERS' SUMMIT

18 Tips for the Chapter and State Council Anti trust Leader • Be careful to recognize potential antitrust issues • When consultants are discussing their business – no fee discussions • Ensure you have a membership discipline process • When expelling or denying membership to a competitor of members of the chapter –be fair and consistent; do not play favorites • Wage surveys – put them in the FTC/DOJ safe harbor 2015 SHRM VOLUNTEER LEADERS' SUMMIT

19 Tips for the Chapter and State Council Leader Services to Non-Members • Denial of association services to non-member competing HR professional may be challenged as a group boycott • Association can charge higher fees to non-members as long as such fees are justified. • Non-member denied services will have burden of showing denial of significant economic advantage; but to deny non-member access is to run risk of antitrust challenge • Better to have tiered pricing vs closed events 2015 SHRM VOLUNTEER LEADERS' SUMMIT

20 Tips for the Chapter and State Council If you conduct surveys for your members… Leader • Place survey of wages, or other significant costs of company, in FTC/DOJ “safe harbor rules” by doing the following things. – Report only aggregate statistics with each reported statistic based on at least 5 responses with no response representing more than 25% on a weighted basis. – Information provided is at least 3 months old. 2015 SHRM VOLUNTEER LEADERS' SUMMIT

21 Don’t forget to collect your employees taxes Sections 6671 and 6672 of the Internal Revenue Code • Officers or employees of a corporation, who are under a duty to collect and turn over taxes such as employee income/Social Security/Medicare taxes • Can be personally liable for any amount of such tax which is not paid, if they willfully cause the corporation to fail to pay such taxes 2015 SHRM VOLUNTEER LEADERS' SUMMIT

SHRM VOLUNTEER LEADERS’ SUMMIT | 2015 22 When negotiating contracts • Require hotels and convention centers to comply with applicable safety and health laws and with the Americans with Disabilities Act. • Do not agree to a contract provision that allows hotel or convention center to cancel or fail to provide promised facilities or services for any reason other than uncured breach of association, Force Majeure Event or Acts of Gods. • Include in contract “acts of God” clauses which permit cancellation of an event without liability, such as natural disasters, terrorism, or other events which make holding the event either impossible or so burdensome as to warrant discharge from contractual obligations. • Limit relocation of space to space that is comparable in terms of size convenience and amenities 2015 SHRM VOLUNTEER LEADERS' SUMMIT

SHRM VOLUNTEER LEADERS’ SUMMIT | 2015 Think about going beyond compliance… 23 Sarbanes Oxley Act (“SOX”) - Corporate Governance Considerations • SOX does not apply to tax exempt organizations (except for one whistle-blower section of the Act) • BEST PRACTICE - tax exempt organizations are increasingly choosing to voluntarily comply with many of the SOX corporate governance provisions – Independent and competent audit committee – Financial Statements Certified by CEO and CFO – Conflict of Interest Policy/Code of Ethics – Rotation of Outside Audit Partner 2015 SHRM VOLUNTEER LEADERS' SUMMIT

SHRM VOLUNTEER LEADERS’ SUMMIT | 2015 Copyright or trademark infringement 2015 SHRM VOLUNTEER LEADERS' SUMMIT 24

SHRM VOLUNTEER LEADERS’ SUMMIT | 2015 25 Tips for the Chapter and State Council • Do not share SHRM Learning Systems or have a library where it is loaned out (violation of Leader SHRM’s Code of Ethics) and infringement of SHRM’s copyright. • Get speakers' permission to record and sell or give away copies of their presentations (includes copies of slides). – Slides from SHRM Speakers’ Bureau speeches are copyrighted and may only be distributed to an audience at a SHRM speaker presentation. • Get photographers’ permission to use or reproduce photos. Get Artists permission to use music – purchase and use royalty-free music or pictures – approach music producers, emerging artists or photographers and obtain permission to use their music or media – obtain a license to legally use copyrighted music (e. g. , ASCAP or BMI) 2015 SHRM VOLUNTEER LEADERS' SUMMIT

26 The AFFILIATE OF logo – The logo to use Chapters and state councils (SHRM affiliates) in good standing are licensed by their charter to use only the marks set out in these guidelines. To preserve SHRM’s rights in its marks, the law requires that the marks must be used on goods and in association with services of a nature and quality which SHRM has approved. SHRM allows its affiliates, including chapters and state councils, to use by license the SHRM name, acronym, and AFFILIATE OF logo, if certain guidelines are followed. • Please refer to Page 3 of the Affiliate Graphic Standards for full details. 2015 SHRM VOLUNTEER LEADERS' SUMMIT

27 Do’s and Don’ts of the Chapter logo • • • Do use either “SHRM” or “Society for Human Resource Management” in your logo (i. e. the one that is in the legal name or ‘also known as’ name in your bylaws) Don’t use a conjoined H and R (their spines touching) when using the SHRM acronym Do use your chapter logo in conjunction with the SHRM AFFILIATE OF logo and not as a substitute for the SHRM AFFILIATE OF logo Ensure that “SHRM” and “Society for Human Resource Management” are treated the same as the rest of your chapter/state council’s name. Same font size, color, style. Do NOT register any “SHRM” or “Society For Human Resource Management” logo in any federal, or state trademark office Additional details on the creation and usage of the Chapter logo can be found in the Affiliate Graphic Standards available on the Volunteer Leader Resource Center (VLRC). 2015 SHRM VOLUNTEER LEADERS' SUMMIT

28 Why use the SHRM logo at all • • A fast food analogy – Mc. Donalds • Would you be a part of a great brand like Mc. Donalds but not use the Golden Arches for your franchise? The SHRM logo should be viewed as the equivalent – SHRM invests substantial time and money in building the strength of the SHRM brand • We want you to leverage these efforts and use the AFFILIATE OF logo properly; this only sets chapters up for success 2015 SHRM VOLUNTEER LEADERS' SUMMIT

29 Using the SHRM logo • • • The SHRM logo may only be used with advanced written permission from the SHRM General Counsel or Marketing Department Members of SHRM are not permitted to use the logo on their own personal or company websites or personal/professional materials You may use the “Society for Human Resource Management” name or acronym (i. e. , “SHRM”) to refer to your membership or volunteer leadership role in SHRM without additional permissions 2015 SHRM VOLUNTEER LEADERS' SUMMIT

30 SHAPE 2015 SHRM VOLUNTEER LEADERS' SUMMIT

31 Questions? 2015 SHRM VOLUNTEER LEADERS' SUMMIT 31

32 THANKS! 2015 SHRM VOLUNTEER LEADERS' SUMMIT

33 Quick Overview 501 (c ) (6) vs 501 (c) (3) 501(c)(6) • • Educational, charitable, and religious organizations Form 1023 Charitable contributions may be tax deductible Permitted to lobby – do not devote substantial part to lobbying activities Less than 5% of activities to lobbying Safe harbor – 501(h) election • • • Trade associations, professional societies, business leagues Form 1024 Charitable contributions are not tax deductible No restriction on amount of lobbying activities Business expense deduction for dues except that portion used to support lobbying activities Amount of dues spent on lobbying must be disclosed to members 2015 SHRM VOLUNTEER LEADERS' SUMMIT