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Volunteers are the lifeblood of many nonprofits. Their passion and energy support your mission, and without them, many programs would stall. But blurring the line between volunteer and employee can lead to costly legal headaches.
Why Maintaining a Clear Delineation Between Volunteers and Employees Matters
Unlike employees, volunteers are not covered by wage and hour laws. However, that exemption only applies if they are truly doing the work of volunteers.
Nonprofits sometimes treat volunteers informally, assuming that good intentions offer protection from labor violations. But courts and regulators focus on how the relationship actually functions, not what you call it.
If a volunteer is performing the same tasks as paid staff, working regular hours, or receiving compensation in any form, they may be entitled to employee protections regardless of your intent. Even accidental misclassification can lead to legal and financial consequences, especially if multiple people were affected. That’s why clearly defined roles and boundaries are essential.
According to the U.S. the Department of Labor, the key criteria for unpaid volunteers are:
- They must offer their services freely and without coercion.
- They must not expect or receive compensation.
- Their service must typically be for public service, religious, or humanitarian objectives, especially at nonprofits or government agencies.
- Their work should not displace regular paid staff or resemble standard employment.
In Georgia, there’s no separate statute for volunteers, so the federal definition applies. If a nonprofit unintentionally treats volunteers like employees, it risks fines, claims for back pay, and potential liability under wage laws.
Legal Best Practices to Keep Nonprofits Protected From Employment Law Risks
Define Roles Clearly in Writing
Every volunteer should have a signed agreement that outlines their responsibilities, reporting structure, expected conduct, and a clear acknowledgment that they are not receiving compensation. These documents show that the relationship is transparent, voluntary, and limited in scope.
Avoid Compensation or Incentives That Cross the Line
Volunteers can be reimbursed for actual, pre-approved expenses like travel or supplies, but anything that resembles a financial reward creates risk. Stipends, honorariums, or gift cards, even small ones, may be interpreted as wages.
Perks tied to performance or participation, such as free tickets or other rewards, can also suggest an employment relationship and should be avoided unless they are incidental and explicitly non-compensatory.
Document Everything and Keep the Records
Maintain signed volunteer agreements, time logs (if you track hours), copies of any reimbursements, and screening or onboarding materials. These records create a paper trail that can protect your organization if the classification is ever challenged. Documentation also reinforces that your program is well-run and compliant.
Offer Optional Training, Not Mandatory Commitments
Training is fine, especially for onboarding, but it should not mirror the job style training expected of employees. Keep volunteer training brief and focused on volunteer-specific responsibilities. If it starts to feel like the kind of onboarding you’d give a new hire, it may raise questions about whether the role should really be unpaid.
What to Do If Misclassification Happens
If an audit or complaint indicates a volunteer should have been paid:
- Assess the role critically
- Convert them to staff (if budget allows) or reclassify and compensate retroactively
- Document the issue, how it was discovered, and what you changed
- Adjust policies to prevent the issue from recurring
- Consult a nonprofit attorney for cleanup and future prevention
Proactive correction and transparency may help mitigate penalties.
A Nonprofit Attorney Can Help You Leverage Volunteers With Confidence
Volunteers are a gift to your nonprofit, but handling their roles without legal clarity is risky. Keeping volunteer programs compliant requires purposeful role design, clear boundary setting, and strong documentation. When gaps appear, addressing them quickly with proper safeguards can protect both your organization and the people who serve it.
Need a review of your volunteer program or support drafting compliant agreements? Cameron Hawkins helps Atlanta nonprofits manage legal risk with confidence. Call (678) 921-4225 to schedule a consultation.
