Major Considerations for Nonprofits – Legal Advice in Response to the Pandemic

May 2020: Major Considerations for Nonprofits – Legal Advice in Response to the Pandemic

As spring began to turn to summer, The Community Foundation saw that our charitable partners across the community had started to get a handle on the emergent needs created by the pandemic.

By early May, most organizations had acquired proper protective equipment. They had plans to serve clients or shift programs online. Organization leaders were ready to move from reaction to planning for action in the COVID-19 environment.

To provide guidance, The Community Foundation, with financial support from the George and Frances Ball Foundation, invited nonprofit legal advisor Zac Kester, of Charitable Allies, to speak on “Major Considerations for Nonprofits in a (Post?) Covid-19 World.” The Zoombased presentation was designed to help local nonprofit organizations understand what legal options they have in recovering revenue, managing debt, and navigating operations during the pandemic. More than 30 representatives from local organizations attended.

Jay Julian, President and CEO of Muncie Delaware County Chamber of Commerce, has worked with Charitable Allies to file and maintain a business interruption insurance claim.

Participating organizations were eligible to access personalized legal services from Charitable Allies. Five organizations worked with legal advisors to submit business interruption insurance claims and have other legal concerns addressed; Greater Muncie, IN Habitat for Humanity, Minnetrista, Muncie Delaware County Chamber of Commerce, Muncie Symphony Orchestra, and YMCA of Muncie. Because there is limited legal precedence related to business interruption due to a global pandemic, the relationship between these five organizations and Charitable Allies will continue to be funded by The Community Foundation into 2021.

WE THOUGHT THAT WE HAD COMPREHENSIVE INSURANCE IN PLACE TO SUPPORT OUR BUSINESS AND OUR STAFF IF SOMETHING FORCED US TO SHUT DOWN. THE LOSS IS LEAVING LONG-TERM IMPACT. WE CAN’T DO EVERYTHING WE WERE DOING BEFORE THE PANDEMIC BECAUSE OUR CLAIM WAS DENIED.

- Chad Zaucha, President and CEO of the YMCA of Muncie

KEY TAKE AWAYS

1. Employee Benefits

The Families First Coronavirus Response Act extended paid sick leave for COVID-19-related illness and quarantines to even the smallest businesses and nonprofit organizations.

2. Business Interruption Insurance Claims

Organizations with business interruption insurance might be able to make a claim in response to stay at home orders in order to recover some loss of income.

3. Preparing for the Future

Most nonprofits are required to have an Emergency Preparedness Plan per the U.S. DOL, Office of Safety and Health Administration (OSHA). This is the time to update or create that plan.