Avoding Intermediate Compensation Sanctions: Non-Profit

Creating a Safe Harbor for a Non-Profit through Effective Compensation Review

Client Case Study

Situation

This faith-based non profit organization engaged us to conduct such a review annually, helping the organization to create a safe harbor if challenged by the IRS.

Having a third party conduct a comparative compensation review of those positions identified as disqualified is an important step in creating a rebuttable presumption of reasonableness, or safe harbor.

Complications

Intermediate Sanctions may be imposed on any disqualified person who receives an excess benefit from a covered non-profit organization and on each organization manager who approves an excess benefit.

Intermediate Sanctions allow the IRS to impose excise tax penalties on both the executive and board members involved with the excessive compensation.

 

Approach

  1. Categorize: Once the organization’s legal staff identified those positions and individuals categorized as disqualified, we utilized a combination of executive interviews and job documentation to gain a thorough understanding of the positions under review.
  2. Market Comparison: The total compensation (base salary, short term incentives, long term incentives and benefits) of these positions was then compared to that of jobs in similar types of organizations.  When conducting this comparative analysis, we focused on matching up the scope, responsibility job duties to positions in organizations similar in terms of size (number of employees, revenue, operating budget, assets, etc.) and type.

Results

  • We then documented the methodology and findings in a thorough report which the Board of Directors utilized to make targeted compensation decisions, ensuring compliance and creating a rebuttable presumption of reasonableness.

Related Information

We partnered with LSA Global to help us invest in our people in the areas of performance coaching, diversity, and inclusion. They focused on helping us succeed and were very flexible in meeting our specific needs. LSA Global exceeded my expectations from a speed, quality, and value standpoint. I would recommend LSA Global to anyone looking for a true business partner.

Anita Luckinbill
Director, Human Resources

LSA Global’s consultant brought a fresh perspective to our behavioral based interviewing strategy for two key executive positions we needed to fill, and their consultant helped us develop questions that produced a much deeper understanding of candidates’ capabilities. I am confident that the two new executives joining our organization have the right skills to add significant value. Throughout the process LSA was also very responsive in dealing with short lead time requests.

Because of the unique nature of our business, Excel is a core application in our accounting organization. After three attempts to find an Excel consultant who is capable of helping our finance team integrate advanced applications into our work processes we found LSA and Alex. He was not only a “Real” Excel expert but was masterful in helping us identify where to use Excel applications in our processes to increase our group’s efficiency.

SPO Partners & Co
Kim Silva, CFO

Thank you for a great leadership development session today. The facilitator was brilliant, and we really enjoyed his style and personality. The sales team got a lot out of it (as did I). I believe it will help us create an even higher performance environment by ensuring we have a common understanding of our environmental structure and are all working towards the same goals.

Simon Jefferson
Managing Director

AKQA

We turned to LSA Global to help take our behavioral interviewing process to the next level in terms of both efficiency and effectiveness. LSA quickly understood our unique culture and challenging requirements.  They immediately helped us to improve our ability to continue to hire top talent that fits our culture and talent management strategy as we rapidly scale.

Julie Pearl
Technical Program Manager

Google

I have worked with other training companies and found it to be more of a seller/buyer relationship than one of matching the right expertise to our business issues. That’s what LSA does – ask the hard questions, listen, and understand our business needs. We receive the benefit of their expertise from assistance with personal development plans to enhancing team performance, to looking at enterprise-wide challenges. It’s all about helping our business succeed as we grow. Right now, LSA is providing great ideas, a fresh approach, and valuable guidance as we develop our management team and accelerate our client relationship management results.

Kristin Westland-Kaune
Director, Team Development

I contacted LSA to help us with leadership development. LSA worked with me to identify a solution that would match our needs as well as our personality. The solution was such a huge success. It received rave reviews. I would highly recommend LSA to other companies.

Karen King, SPHR
Manager, Human Resources

Alliance Data

The customized new hire on-boarding process, coaching, tools, and measurement have provided a very useful structure and frame for the first 90-days for both me and our new hires. It has been a very positive experience from my perspective and will make it much easier to on-board my new hires.

Martyn Storey
Systems Engineer Manager

It was a challenge to find a consultant with an approach to performance improvement that fit our unique culture and style. We were pleasantly surprised to discover LSA’s depth of expertise in the fields of motivation, developmental coaching and performance management and measurement.

LSA seamlessly integrated those components without our folks feeling like the intervention was forced. They understood what we were trying to accomplish, helped us clarify our objectives, and created a solid, refreshing approach that quickly got us moving and engage at all levels across the organization.Overall, I couldn’t be happier that we found a true strategy and implementation partner in LSA.

Doug Hansen
President and Director

Redwood Trust

Redwood Trust looked to LSA Global as a consulting partner to help us explore innovative and scholarly approaches to promote employee engagement and sustain the unique culture we’ve built over the last decade.  LSA helped us perpetuate coaching as a discipline across the organization by integrating our core values, goal setting and performance management under an interactive coaching program.  We appreciate LSA’s commitment to cutting-edge practices to help keep us a step ahead during this time of rapid change.

Rosalyn Chan
Vice President, Human Resources

Redwood Trust

We have had a very beneficial partnership with LSA for over 2 years. The recent Leadership Development Program that they designed and customized with us to help us identify, develop, and retain top leaders in the organization was a huge success. It was instrumental in helping take our company and our key people to the next level. I would recommend their training and consulting services to anyone looking to develop and retain top talent.

Steve Janowsky
Vice President of Operations

Proxicom

The LSA customized Organizational Alignment Survey gave us a comprehensive view of how our employees experience our culture, talent and strategy.  Equally important, the survey and implementation process goes well beyond the typical engagement survey.  The systemic approach provided us with a great forum to discuss the strengths and opportunities in our organization, and then to quickly get focused on the key actions critical to executing our business and people strategies.

Mark Forrest
General Manager, FSM Division

Trimble

We partnered with LSA to help custom design, deliver, and measure an advanced new employee on-boarding and measurement process. The process was well thought out and bought into by sales leadership. The combination of targeted sales tools, technology, coaching, performance plans, training and reinforcement made all the difference.  The pilot program in EMEA was a big success and the solution quantifiably improved new employee and hiring manager satisfaction and increased the speed to sales quota for new hires. We are continuing to work with LSA Global to scale the program in other GEOs and expand to cover more roles at VMware.  I would recommend LSA Global for any sales enablement team looking to increase the engagement and speed to productivity of their sales force. We are excited to implement the program globally across VMware as we continue to scale.

Rochana Golani
Director, Global Field Readiness

We consistently receive positive feedback about the quality of the LSA Leadership Training Programs and LSA facilitators. We recognize and appreciate the hard work LSA always goes through to align to our unique culture and meet our specific requirements. Thank you for regularly going above and beyond to design solutions to meet our needs. Your support and dedication, both on the strategic and tactical side, have been outstanding!

Anna Meyer
Leadership Development

Intuit

“We turned to LSA to help us custom design and deliver a leadership and management development curriculum to help drive performance. They have done an excellent job diagnosing the business situation, designing an approach that fits our culture, and delivering a first class solution.”

Sally Buchannan
VP Human Resources

I just wanted to let you know how pleased I am with how the new employee on-boarding project went. The end product is wonderful! LSA has been great to work with. I really appreciate all the flexibility and the high quality.

Laurie Torres
Vice President of Human Resources

PDL

Evaluate your Performance

Toolkits

Toolkits

Download key published insights and tools from industry experts highlighting best practices in the areas of talent, strategy and culture.

More

Health Checks

Health Checks

Want to know how you stack up against leading organizations?  Receive a complimentary benchmarking analysis courtesy of an LSA Expert.

More

Whitepapers

Whitepapers

Get up to speed on timely solutions critical to your business. Published by LSA Experts based upon client feedback and key industry trends.

More

Methodology

Methodologies

First we identify the key metrics you want to improve. Then we assemble a dedicated team of elite experts who have successfully solved similar problems with similar clients.

More

Blogs

Stay up to do date with the latest information on how we help high growth companies align their culture and talent with strategy.

More

Case Studies

Client Case Studies

Real world consulting and training approaches from LSA projects, providing insights on how your company can outperform the competition.

More