Advice on charity constitution

clintaughjl

Hi,
I'm not sure if you can provide the advice I am looking for but as a new
member to a local Association I have been made aware that a fellow trustee is in receipt of a payment of £7000.00 from the Association for providing services as an administrator. The payment has been made without any discussion at our committee ,and when I queried why, I was told it was within the rules of our constitution.

I have pasted below the relevant section of the constitution, which is
gobbledygook to me, and would ask if you can translate or give advice.

"Provided that nothing herein shall prevent the payment, in good faith of
reasonable and proper remuneration to any officer or servant of the
association, or to any member of the association in return for any
services actually rendered to the association, nor prevent the payment of
interest at a rate not exceeding five per cent per annum on money lent or
reasonable and proper rent for premises demised or let by any member of
the association, but so that no member of the committee shall be appointed
to any salaried office of the association or any office of the association
paid by fees, and that no remuneration or other benefit in money or
money’s worth shall be given by the association to any member of such
committee, except repayment of out of pocket expenses and interest at the
rate aforesaid on money lent or reasonable and proper rent for premises
demised or let to the association provided that the provision last
aforesaid shall not apply to any payment to any company of which a member
of the committee may be a member

pink_numbers

Sorry, not help to offer (as I'm not legally trained) but the person who wrote that rule needs to learn how to use commas and full stops!!

oldtoolie

If your association is a registered charity, trustees are not normally allowed to become paid staff of the charity without authorization of the Charity Commission.

This is charity law which would override anything in your charity constitution.

See this briefing CC11 - Trustee expenses and payments

http://www.charity-commission.gov.uk/publications/cc11.asp

I suggest you read this and other material on the CC website relating to being a trustee so that you will know your responsibilities. Then you should speak to the Charity Commission telephone helpline for advice on what to do next.

PlutoinCapricorn

There is also the question of income tax and NI: did the trustee invoice the charity i.e. do the admin on a self-employed basis?

fengirl_2

Absolutely not allowed. Even though your constitution allows it, the law has been changed and you now have to have CC permission for payments to trustees in excess of £1000. You have to show that no one else would be capable of doing that work. There is detailed guidance here:
http://www.charitycommission.gov.uk/publications/cc11.asp#e3
see section E3.

bani

Agree with earlier inputs, plus:
1 Any charity committee which cuts short your discussion on this subject without attempting to explain the situation/background to a new trustee needs to rethink its attitude.
2 £7000 is an awful lot for an admistrator unless its a large charity.

Consult the Charity Commission quickly

fengirl_2

Bani, I'm afraid that the CC will tell them to sort it out themsleves - they only investigate the very big cases nowadays. They will just refer the OP to the relevent leaflets and remind them of their duties as trustees. If the OP is having a tussle with their board, the lcoal CVS could probably help.

Bani_2

Fengirl, yes I agree, but the OP needs to understand the formal Charity Commission position for him/herself before proceeding, and to have the facts available to present to the other trustees.

Clintaughil, in case you are not aware, your District or Borough or other local Authority area will have a Council for Voluntary Service (CVS) , sometimes called by other names like Voluntary Action xxxxxx where xxxx is the district name. A CVS is a independant voluntary group which has been set up to help and support the local voluntary sector. One of the CVS' roles is to support local voluntary/charitable groups and trustees with advice on governance. As Fengirl says, you may be able to get assistance/advice from your local group. If you can't easily find your local group the Council or maybe local Library will be able to point you in the right direction.

(Declaration of Interest: I am a trustee of a CVS)

Lazy_Ike

As a Trustee of a local charity, I can only support Fengirl, and Bani's submissions, and encourage you to consult with your local CVS. Our/my experience with our local CVS is they could not be more helpful, and have helped us in many ways, although nothing of this particular nature.
I also would like to say that the quoted gobbledegook is indeed gobbledegook, and has no place in a correctly drafted constitution. It is too long winded. It needs to be turned into proper simple English, made meaningful, and should be broken up relevant sections. The response the OP got from the longer standing Trustees; this gobblegook constitution, and the event itself would make me very suspicious of peoples' motives.