The Ultimate Charity HR Guide | Our tips and best practices for UK not-for-profit organisations

We’ve all seen the story before – a successful charitable/not-for-profit SME that is in a continual battle with limited resources. 

Due to the focus on providing results in your mission-driven work, often within tight financial boundaries, running the human resources (HR) function effectively can be a real struggle to match the level of service provided to those your work supports.

So, how can you provide the most efficient and employee-focused HR department with little outlay? Here’s our guide on how to effectively manage your HR function.

Sections:

• Strategic Planning

• Recruitment and Hiring

• Communication

• Training and Development

• Performance Management

• Compensation and Benefits

• Employee Engagement and Retention

• Technology and Systems

• Legal and Ethical Considerations

Strategic Planning

We start, as all good HR departments should, with a clear strategy. Integrating the HR plan into the overall charity’s strategic plan ensures that human resource efforts are aligned with the goals of the organisation. 

With many charitable organisations the mission and values are often more visible and critically aligned to the strategy than in the private sector so you should be able to assess the current and future charity HR needs based on growth in, or progress towards, these goals.

You should also develop a workforce plan from the start that includes recruitment, training, and succession planning. If your organisation relies heavily on the knowledge or experience of staff or volunteers (as opposed to documented/digitised processes) it’s important that knowledge transfer is built into your plans in case of staff resignations or retirements (especially from voluntary officers).

Finally, in your strategy it is important to build in flexibility. Charities can be particularly susceptible to changes in their external environment or even governmental policies, so have some contingency in place (even if limited) to be able to react quickly to change – especially if you don’t have budget or cash in the bank to throw into costly adaptations.

On a smaller scale, ensure you stay informed about industry trends and emerging best practices in order that you can quickly revise policies to both stay legitimate and improve efficiency in your operations. Foster a culture of continuous improvement where feedback is valued and acted upon. This flexibility helps the charity remain resilient and responsive to both opportunities and challenges.

Recruitment and Hiring

We mentioned it in your strategy but alignment to your organisation’s mission is crucial and therefore should be reflected in your recruitment plan. It’s important you strive to appoint individuals who are passionate about your mission to help foster a proactive working environment and extend employee tenures – especially in situations where wages may be typically lower than counterparts in the private sector.

To enact this you should clearly communicate your charity’s goals and values during the recruitment process and be honest about the commitment involved. When screening candidates, include questions that explore their own commitment to your mission. 

For instance, ask about their previous volunteer experiences or why they are drawn to the charity's mission. Additionally, involving current team members who are deeply engaged with the mission in the interview process can help identify candidates who will fit well with your organisation’s culture.

As a charity, you should also be acutely aware of developing a diverse and inclusive workforce. Not only does this help enhance creativity and problem-solving, but you may even be able to tap into your staff’s own experiences if they have come from a situation where they were on the receiving end of help from a charity like yours.

Ensure in your recruitment practices that you expand your candidate pool and not just focus on advertising in the ‘traditional channels’ (i.e. job hunting sites) but also by reaching out in areas where your work may already be known in the area.

Once you have recruited a diverse workforce ensure you foster an inclusive environment by encouraging open dialogue and addressing any discriminatory behaviours promptly – including having a training plan for your staff.

Finally, we couldn’t talk about recruitment in charitable organisations without mentioning volunteer management.

Volunteers are a vital resource for many charities, and managing them effectively requires a structured approach. Develop a comprehensive volunteer program that includes orientation, training, and regular feedback. Create clear role descriptions and match volunteers to tasks that align with their skills and interests. 

If you can, use volunteer management software to track hours, skills, and contributions – this could even be a basic, free tracking system to enable you to recognise and celebrate your volunteers to help enhance their retention and satisfaction.

As mentioned before, ensure you also plan a knowledge transfer for your volunteers as their expertise can be critical to your success, yet they have no contractual ties to your organisation – meaning you won’t necessarily benefit from a planned ‘handover’.

Communication

Clear communication is important for any organisation – but this becomes more of a feature for modern charities when you consider the number of stakeholder groups involved in the day-to-day running of the organisation.

From the board and trustees, through to the ‘main’ office staff, often regional or hybrid working staff, plus the supporting volunteer community it’s difficult to get everyone around the same table.

Fostering an open communication culture helps build trust and collaboration within these separate groups. Create channels for regular communication, such as team meetings, strategic sub-committees, e-newsletters, and even suggestion boxes for volunteer input. 

Further encourage your transparency by sharing organisational updates and decision-making processes. Make it easy for your staff and volunteers to voice their concerns or ideas and ensure there is a process in place whereby they can receive timely responses.

If you keep providing regular updates on your progress (towards goals, financial health, and strategic plans) it ensures everyone feels connected to the charity’s mission and understands their role in its success.

Training and Development

Providing quality training and development opportunities at charitable organisations can be difficult due to the lack of resources (both time and financial), but this doesn’t mean you can ignore them. 

Investing in the continuous learning of staff and volunteers keeps them motivated and effective. To do this, offer a variety of training opportunities, such as workshops, online courses, and mentoring programs. There are plenty of free, low-cost or even grant-applicable training opportunities out there for non-profit organisations.

Where you can, tailor their training to address both the technical skills needed for specific roles and the soft skills that enhance teamwork and leadership. Encourage a culture of learning by allocating time for professional development and recognising those who pursue growth opportunities.

Alongside role-based training you should also focus on identifying and nurturing future leaders. Creating a leadership development programme is crucial for the sustainability of a charity. 

This could include mentorship, coaching, and opportunities for emerging leaders to take on new responsibilities. Not only can you do this by pursuing available external courses, but consider what experience your volunteer community can offer.

Performance Management

One thing charities can often learn from the private sector is performance management and objective setting. Historically charities have focused on mission results and the display of value-based work, but this shouldn’t come at the expense of results.

Setting clear, measurable goals not only helps align the efforts of staff and volunteers with the charity’s mission, but also gives staff clear and accomplishable goals that they can feel driven towards achieving and pride at their successful resolution. 

Develop your performance metrics that reflect both individual and organisational goals. Where possible still focus on setting SMART objectives and conduct your performance reviews with these in mind. Use these reviews to set new objectives and identify areas for improvement. This can also help you stay aligned to your organisation’s mission and values as you can adapt objectives regularly where necessary.

Finally, ensure you regularly talk to your staff.  Ongoing feedback helps staff and volunteers understand their performance and areas for growth. Implement a system for regular check-ins between managers and team members to discuss progress, address challenges, and set new goals. Encourage a two-way feedback culture where employees feel comfortable sharing their thoughts and suggestions. Regular feedback fosters continuous improvement and stronger team dynamics.

Compensation and Benefits

As we’ve already identified, it’s unlikely your chaity will be able to offer financial incentives or bonuses to staff to compete with the private sector. However, offering competitive salaries is essential for attracting and retaining your talent. 

Ensure you’re up-to-date with salary ranges in the nonprofit sector to guarantee your compensation packages are fair. Where financial compensation is limited, enhance benefits with non-monetary perks like flexible working hours, professional development opportunities, and a supportive work environment.

You might find that negotiating perks with local providers or even organisations connected to your charitable work can be arranged for your staff at a favourable rate – it may just take more time investigating on your own behalf to set these up.

If you can offer compensatory benefits or experiences then consider other potential morale-boosting benefits you can offer. Having a flexible working arrangement (to accommodate personal needs and promote work-life balance) could help retain your staff for longer.

Meanwhile, opportunities for professional growth, such as training and career development workshops, as well as regular team-building activities and recognition programs can help your staff feel valued even without the financial incentive.

Employee Engagement and Retention

Preventing burnout is essential in the potentially stressful environment of a charity. Promote your work-life balance by encouraging staff to take regular breaks, offering flexible work hours, and allowing remote work when possible – this is a decision your business can make for itself. 

Consider implementing policies that support mental and physical health and create a culture where taking time off is encouraged and respected. 

Alongside promoting a positive work-life balance, it is also important to regularly acknowledge the contributions of staff and volunteers in your organisation. Develop formal recognition programs that include awards, public acknowledgments, and small tokens of appreciation. 

Create an inclusive environment at your charity where everyone feels valued and part of the mission. Regular check-ins and surveys can help gauge engagement levels and identify areas for improvement, which hopefully will naturally match the values of your organisation.

Technology and Systems

Making considerations for your HR tech fits into two key categories; 1) affordability and suitability, and 2) data security

Utilising HR management software can streamline many administrative tasks, freeing up your time for strategic initiatives. However, as a charity you may not be able to afford the most suitable systems for your needs or organisational size due to budget restraints.

If you need help to identify a system that fits your charity’s needs, whether it's for payroll, benefits administration, or volunteer management – you might want to call on the support of a HR consultant like Dolen HR to aid your efforts. 

Once you have a solution, ensuring that personal information is protected is critical. Not only could your organisation work with vulnerable citizens or come into contact with sensitive material, but you will also have to deal with the management of private data that may be used by lesser trained volunteers during your projects. 

Implementing robust data security measures, such as encryption and access controls, to safeguard employee and volunteer information will be important for your sustainability as a charity. Regularly review and update security policies to address emerging threats. Provide training on data protection practices and ensure compliance with relevant regulations, such as GDPR, depending on your location and type of data handled.

Legal and Ethical Considerations

The final section of our guide and still one of the most important. Ensuring compliance with labour laws and regulations is non-negotiable for your charity – not just from a business perspective, but as a reputational safeguard for the efforts of your mission work. 

Stay updated on relevant laws and regulations that affect your organisation by signing up (and reading!) core publications. Conduct regular audits to ensure all HR practices are compliant. Provide training for managers on legal requirements and ethical standards. 

By upholding high ethical standards it will help build trust and credibility in your organisation. Develop a code of ethics that outlines expected behaviours and decision-making guidelines – aligned to your organisation’s values. 

Provide regular training on ethical conduct and ensure all staff and volunteers understand the importance of integrity. Create an anonymous reporting system for ethical concerns and take prompt action on any reports to maintain a culture of accountability.

There’s certainly a lot of detail to mull over here if you’re just starting out on your HR efforts at your charity. If you do need support in any, or all, of these areas, you can always contact our team at Dolen HR.

We’ve already perfected years of experience in implementing charity HR strategies, identifying appropriate softwares and systems on a budget and delivered real change for not-for-profit organisations across the country. 

We offer a range of services, including hybrid and pay-as-you-go solutions, that mean you can get the support you need for the budget you manage. Get in touch today.