If your company is a nonprofit or has a nonprofit foundation, are you covered if something happens to your volunteers while they’re engaged in service to your organization?
The concern is real. There were 287 fatal occupation injuries among volunteers from 2003-2007. Prudent nonprofits carry insurance, called “volunteer accident insurance,” to cover injuries to volunteers.
There are significant differences in how states address workers’ compensation coverage for volunteers. Workers’ compensation coverage can limit employer liability for injuries to an employee or, in some cases, a volunteer.
Under California law, a nonprofit can opt into workers’ compensation coverage with respect to their volunteers. But absent such an affirmative election, volunteers for nonprofit organizations generally are excluded from the definition of “employee” and therefore are not covered by the workers’ compensation and insurance laws (Labor Code § 3352(i)).
“[A] person who performs voluntary service without pay for a private, nonprofit organization, as designated and authorized by the board of directors of the organization, shall, when the board of directors of the organization, in its sole discretion, so declares in writing and prior to the injury, be deemed an employee of the organization for purposes of [workers’ compensation and insurance] while performing such service.” (Labor Code § 3363.6(a)). As a result, opting into workers’ compensation coverage effectively requires an affirmative resolution of the nonprofit’s board to have volunteers be deemed employees for purposes of workers’ compensation and insurance coverage.
For this purpose, “ ‘voluntary service without pay’ shall include the performance of services by a person who receives no remuneration other than meals, transportation, lodging, or reimbursement for incidental expenses.” (Labor Code 3363.6(c)). A volunteer who is an “employee,” by a written declaration of the board, would be entitled to full coverage as an employee.
Nonprofits that do opt in may wish to contact their workers’ compensation insurer to preempt coverage disputes that may arise after an illness or injury claim is made by a volunteer. Workers’ compensation insurance premiums are often based on gross payroll amounts. Because volunteers are not paid, a different allocation could be requested by the insurer to increase premiums accordingly.
Nonprofits should seek to prevent injury to their volunteers (and employees) by providing a safe workspace. At a minimum, while the federal Occupational Safety and Health Act’s (“OSHA”) and California’s similar statute do not appear to protect volunteers, OSHA has indicated that its coverage provides that any charitable or non-profit organization that employs one or more employees must comply with OSHA’s requirements and regulations. In any case, the proper supervision of volunteers should include the provision of a safe working environment.
The use of volunteers by nonprofits comes with legal risks, including those arising from injuries that volunteers incur. Those nonprofits fortunate enough to have people willing to serve without compensation are advised to consider carefully the possible legal implications before accepting services from such individuals. Nonprofits with volunteers must provide safe workspaces, consider procuring volunteer accident and volunteer liability policies, and consider formally opting into workers’ compensation insurance, if available.