« The changing shape of retirement around the world | Main | That's right, some purchases are just plain stupid »

July 12, 2021

Is $120,000-plus too much for a charity worker salary?

There are several reasons Canadians are hesitant to donate to charity. Here’s a pretty bad one, and here’s another that doesn’t feature the words “cancer faker.”

Istockphoto_14218389-charity-sign Yet we like to believe – we’re Canucks, after all – the good in people. We want to give, and we want to help.

And then, a story like this comes out and, on the surface, at least, our faith in local charities flies out the window.

According to a Canadian Press study, thousands of charity workers across the country receive salaries over six figures – some even topping the $350,000 annual mark.

By CP’s survey of the tax filings of Canada’s 85,000 registered charities, 6,000 employees took home salaries exceeding $120,000 last year, while a “few hundred” made over $350,000.

(There are around one million charity workers in Canada. Charities must disclose their ten highest-paid workers in its financial reporting.)

These numbers seem high, and remarkably they may come under even more fire than the report last March that showed more than 71,000 Ontario public workers had salaries themselves of over a hundred grand.

But let’s peak behind the Canadian Press’ findings to see why, when most charities operate under the guise that the money you donate goes straight to a worthwhile cause, some workers are taking home such fat paydays.

The defence? Of course, it’s the same as proponents of sky-high CEO pay: if you don’t pay for the best people, a charity suffers.

“If you really want those charities to have an impact and make a real difference, you’re going to need to bring in the best people to work in that sector,” Marcel Lauziere, a rep for charity advocacy group Imagine Canada, told CP. “It’s not only in government and in business. So you will have to pay salaries that are commensurate to that.”

Fair, but what is the cut-off? I think many Canadians could get behind, if it was absolutely necessary, a salary of $120,000 or whatever it may be for a top talent, high-ranking charity official. If a $120,000 charity executive can bring in $1 million in donations where a $60,000 charity executive can only bring in $500,000, that’s money well spent.

Though is $320,000 or more pushing it?

We may have no answer, but fortunately generous Canadians can do their homework if top charity salaries turn them off.

The Canada Revenue Agency lists the nitty gritty on all 85,000 of our nation’s registered charities, including detailed financial reports that cover the spending patterns of every catalogued charity. You can look here before donating if you like.

Do you think charities should cap the salaries afforded employees, or is the “pay for the best talent” argument applicable here, as it is in many other walks of life?

By Jason Buckland, MSN Money



Post a comment


Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...