Top 4 HR Challenges For Nonprofits

group of volunteers
Joanie Turmel
January 13 2022

Non-profit organizations (NPOs) serve communities or are organized around social causes. Regardless of your mission, you most likely don’t want to devote your entire day managing your organization’s human resources. 

However, good HR management is key to achieving your goals and growing as an organization. So, as an NPO, how can you efficiently face HR challenges to finally have the time to focus on your mission?

1) Nonprofit Recruitment and Hiring

The most important asset your NPO possesses is its human capital. Recruitment is therefore a core component that requires your attention. However, overcoming the workforce recruitment challenge in the nonprofit sector is not an easy feat.

What do you need to focus on to recruit efficiently as a nonprofit organization?


A big part of the recruiting process is advertising vacant positions and networking. Being a proactive recruiter will allow you to reach out to more potential employees and help people know about your organization and your cause for future career opportunities: having a database of applicants (or candidate database) is most certainly a wise strategy. 

Indeed, taking advantage of available tools such as LinkedIn will allow you to use professional networking to reach out to candidates who share your organization’s values and appreciate your mission. Focusing on candidates who, like you, want to make a difference in the community will be your best recruitment asset. 

Referral Programs

Your employees’ networks are also an effective resource for seeking new talent in nonprofits. Recent studies have shown that referred candidates are more likely to fit in and stay longer with the organization. 

Therefore, you may want to involve your current employees in your recruitment activities by implementing an effective referral program. It will encourage them to explore their existing networks and help you find interesting candidates who share the same values as your NPO.

For further inspiration, here is an article on recruitment must-haves!

2) High Turnover Rate in NPOs

Did you know that the cost of employee turnover can range from 30% to 200% of the annual salary of the person leaving your organization? This is a costly reality for NPOs that experience high turnover rates. 

In this regard, a study conducted by Nonprofit HR in the U.S. found that nearly 45% of nonprofit employees plan to leave their job in the next five years. Of these, approximately 23% say they do not want to return to a nonprofit organization. 

These statistics are alarming, especially in an industry where every penny counts. But then, how can you increase your organization’s retention rate without spending all your energy on it?

Implementing Organizational Surveys

Above all, it is necessary to have an accurate overview of your employees’ well-being. Regular engagement surveys sent to your workforce will allow you to be aware of any changes in the work environment and rectify the situation if necessary. By fostering a healthy and motivating work environment, you will increase staff retention.

Investing in HR Software for NPOs

Investing in HR software adapted for NPOs reality is a great way to ensure effective employee management and, by extension, to increase your retention rate. In fact, a Human Resources Information System (HRIS) enables the automation of many administrative tasks and the dematerialization and centralization of several processes such as the onboarding of new employees, employee personnel files, and much more! It is a well-known fact:  effective human resources management optimizes your organization’s retention rate. 

3) Ongoing Training

Offering professional development opportunities plays a crucial role for nonprofit organizations. It allows you to evolve as an organization and to expand your business, in addition to being a top way to retain your best talents.

Unfortunately, for NPOs having to juggle tight budgets, training courses are often the first thing to be cut, although it should be otherwise. 

In fact, according to LinkedIn’s 2019 Workplace Learning Report, 94% of employees would stay longer with an organization if they invested in their professional development. 

How can you value your workforce’s ongoing training without compromising your budget?

Using Learning Management Systems (LMS)

Learning Management Systems are the perfect way to offer personalized training based on your employees’ profiles while respecting your budget. 

Indeed, a recent study showed that the learning retention rate for online training is much higher than for face-to-face training.

4) Payroll Management in Nonprofit Organizations

Payroll management in non-profit organizations can be daunting. Jumping between volunteers, interns and regular employees, can be tough to handle.

Besides, having a nonprofit status comes with additional HR challenges, such as a limited budget and the use of funding for some payroll-related expenses. 

All these components can quickly turn into a real organizational headache. Thankfully, there are solutions available to solve this issue.

Investing in Payroll Software

A good payroll software can help you save valuable time and carry out your pay run with greater efficiency.

That’s what Deluxe offers. With many built-in features such as automatic synchronization of HR, benefits and payroll changes, and automatic synchronization of timesheets, vacation, and paid leave, all relevant information will now be centralized on a single platform for considerable time savings.

Using HR and payroll software will also reduce your risk of error and ensure that you are up to date on the latest regulations related to revenue agencies. 

Did you know that several other technological tools exist on the market to efficiently support NPOs in their projects? Opting for software solutions will help you avoid work overload in your team: an excellent asset for your future!

Managing human resources in a non-profit organization is not an easy task, but Folks HR will be your best ally to guide you through your processes. Folks HR’s HRIS takes into account your specific challenges and organizational reality to better help you solve HR situations and support you daily!

Make the right choice to overcome your HR challenges:

Choose Folks HR, a software that takes your reality into account!


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