Although it clashes with the principle of giving one’s time voluntarily, the demands and responsibilities put on some trustees of charities are such that paying them will be a necessity in order to obtain people with the requisite levels of experience and expertise. This was the claim of Lord Hodgson in a recent public speech at a Charity Commission function.
Trustees are entitled to be repaid their out-of-pocket expenses for dealing with the affairs of the charity. However, a trustee who is paid by their charity has to contend with both ethical and legal problems.
Where a person is to be paid for supplying services as a trustee or for supplying goods to their charity, the legal position is as follows:
- The maximum amount of the payment must be agreed in writing between the trustee and the charity;
- The payment must be reasonable for the service or goods supplied;
- The trustees must have decided before making the agreement that it is in the best interests of the charity for the services or goods to be supplied by the trustee;
- The payment must only be received by a minority of trustees where more than one trustee is involved in the paid-for service; and
- The charity’s constitution or regulations should not prohibit such a payment.
In some circumstances, the permission of the Charity Commission may be necessary where a charity wishes to pay a trustee a sum other than by way of reimbursement of expenses.
Click here for guidance for charitable trustees.