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Tuesday, September 9, 2014

What Would Jesus Earn? Salary Inequities Within Christian-Based Organizations

Find IRS information here about CEO earnings of non-profits
In her August 2014 Sojourners article “The Rich Get Richer”, Julie Polter notes that “ninety-five percent of all economic gains in the U.S. since the Great Recession went to the top 1 percent”, and asks, “What does our growing wealth inequality mean for the future of democracy?”

We need to be asking similar questions about what kinds of wage disparities are acceptable within faith-based institutions. What does increased wealth inequity within church-related agencies mean for the future of Christian non-profits?

Thankfully, the pay gap between those at the top and bottom of the wage scale in most faith-based institutions is far less extreme than in the case of major corporations, with the possible exception of certain televangelist organizations. But the gap appears to be widening, and  if one checks out websites like guidestar.org, which lists CEO salaries of non-profits as required on IRS Form 990's, one can be in for some big surprises.

My observation is that when Christian-based non-profits first launch they tend to demonstrate the kind of passion about the group’s mission that makes them willing to make great financial sacrifices in order to accomplish their goals. Then as an organization grows and becomes more mainstream and institutionalized CEO wages and benefits tend to rise to six figures and beyond while the wages of entry level staff remain static.

Dale Ressler of Lancaster, Pennsylvania, head of Friends of Shirati Hospital, clearly represents a non-profit that is in this first stage of development. Ressler, after spending many years in Tanzania working with the Sharati hospital, remains so committed to its mission that he, with the support of his wife Kisari (a native Tanzanian), and with the help of a board of volunteers, raises around $100,000 a year in support of needed medical supplies and equipment. He draws no salary for his fundraising efforts and supports himself by holding down another full time job.

James Stauffer, son of Bible instructor and later president of Eastern Mennonite School J. L. Stauffer, recently told me he learned that in the early twenties his father received a wage of $60 a month from EMS (now EMU), which in today’s dollars would equal about $860, or $10,320 a year. He said most school employees took it for granted that they would need some kind of outside work in order to provide for the needs of their family. The Stauffers raised chickens and took in boarding students.

Even when J. L. Stauffer became the school’s president James doesn't recall his salary  increasing significantly, which illustrates that in EMS’s pioneer stage, competitive wages weren’t seen as a high priority. And during the Great Depression that followed, the school simply couldn’t afford to pay higher wages in any case.

As time went on, Mennonite schools and other agencies became more conventional in their salary scales, with a primary goal being to remain competitive with other institutions vying for qualified teachers and administrators. Today’s Mennonite college presidents generally have salaries and benefits that, while still far below those of big name universities, have increased to well over five times that of entry level instructors. The gap is even greater for the growing number of part time (adjunct) instructors hired, who typically receive no benefits at all.

Christian Aid Ministries in Berlin, Ohio, with an annual relief aid budget of nearly $100 million, is a relatively new conservative Mennonite and Amish Mennonite organization founded in 1981. In its present phase of development it pays its CEO a modest (by most standards) salary in the low $90,000 range. The assistant director earns two-thirds of that figure, and CAM’s chief financial officer’s salary is about midway between the two. Keeping the salaries of administrators relatively low helps keep the organization’s fundraising and administrative costs to 2.4% of its budget.

One wonders how this picture will change as CAM becomes more establishment and less cutting-edge over time. Will it follow the trend toward ever higher CEO pay, and of eventually relying heavily on well paid advancement and development staff to do year round fund raising for them?

Here are some of the kinds of questions we should be asking of our church-based agencies:

1) In light of growing concerns about the gap between worker and CEO pay in the U.S., do you have a policy that governs the salary/compensation differential between highest and lowest paid workers? If so, what is the ratio of your highest-paid to lowest paid staff?

2) In light of ongoing concerns about the gap between rich and poor in the U.S. and between us and the rest of the world, what salary levels do you believe to be acceptable for heads of justice-promoting, Christ-following organizations like yours? $50,000? $100,000? $200,000? $500,000?

Ron Byler of Mennonite Central Committee recently responded to a similar inquiry with the following official MCC statement:

     Policies for salaried/hourly staff will provide a fair wage that is comparable to other faith-based agencies doing similar work, taking into account MCC’s size. 

  o Salary levels will maintain no more than a five to one ratio from the highest salary to the lowest within Canada or the U.S. This will often mean that salaries at lower levels will generally be above market rates and salaries at management levels will generally be below market rates.

o Salaries will be reviewed annually, taking into account changes in the consumer price index and relevant economic conditions.

Jesus once told his followers, “Every disciple, when fully trained, will become like his master.” Doesn't this mean that as Christians we should at least consider the question, “What would Jesus earn?”
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