6 Compensation Factors to Consider When Setting Church Salaries

(Unsplash/ Alexander Mils)

Compensation is a contention point for every organization, but this is especially the case for churches.

As a small church, it can be hard to know what hires to make, and deciding on a salary for those hires can make the decision-making process even more difficult. No one enters ministry to get rich, but even pastors have to factor in pay and benefits when considering a role.

I have laid out six compensation factors to consider while you are navigating how to set a church salary that honors both the organization and the candidate.

1. Consider the role itself. At Vanderbloemen, candidates we interact with will often let us know about specific family needs when it comes to compensation. A candidate's financial needs can be a strong factor in their job search process. However, a candidate's needs should not dictate an expectation that they presume the church will pay for. The responsibilities of the role should determine the range of appropriate compensation.

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For candidates: I encourage you to learn the average salary for your role, in your area and at a church of comparable size. This will give you an idea of what might be a fair salary and a good starting point for a conversation about your assigned compensation.

2. Consider the geographic location. In this day and age, it's easy to do a quick Google search and arrive at what seems to be a reasonable number for compensation. Don't fall into this trap!

The data you will find online is often a conglomeration of information compiled into one giant average number. Accepting this as the final truth is a disservice to both your organization and your future staff member—both things you want to avoid. Instead, look at the data and compare it to your church. Ensure the data is from churches of similar size and budgets, and make sure you adjust the final data for the cost of living.

For candidates: Before you dismiss a salary offer based on numbers alone, check the cost of living in the area against the cost of living where you currently reside. You may find that the salary is much more generous than you originally thought.

3. Know your budget. As a small church, growth should be anticipated for accurate financial forecasting. As your church grows, you will need to move part-time employees to full-time status, and at some point hire more staff. These moments of growth should be able to be met with celebration, not with stress. The best way to do this is to be extremely familiar with your budget and anticipate financial growth.

Churches have to be good stewards of their finances, and regardless of size, budget is a huge factor in how much a church could offer you for a ministry position.

4. Consider the "extras." Working on a church staff is unique for many reasons, one of them being the non-monetary benefits associated with church employment. Pastors are eligible for many unique benefits, including housing allowance, expense budgets, various tax breaks, free lunches, school stipends for children, sabbaticals, and the list goes on.

When assessing appropriate compensation for a pastoral position, these factors must be included. Do your research—determine what your organization offers that is unique and incorporate that into your pay scale.

For candidates: Beyond your salary, are there other benefits that the church is offering to add to your compensation package? For example, some churches have robust health insurance packages with full family benefits, and others choose to offer generous retirement matching programs. Again, don't look only at the proposed salary; take the entire compensation package into account.

5. Assess the risk of loss. It's important to assess the risk of loss for your key staff members. For example, how much would you have to pay a new senior pastor if the planter of your church answered a new call? If your children's ministry pastor left, how much momentum would your church lose overall? You should be asking these kinds of questions to determine pay.

Assess specific ministries' growth and the overall value they add to your church. The people you determine add more value to your church should be compensated commensurately.

This is also a good place to consider the experience of your staff members. In virtually every career field, increased work experience directly correlates to an increase in pay. Ministry is not immune to this same pay structure. A pastor with 20 years of experience should and will be paid more than a pastor with three years of experience.

For candidates: The scope of your responsibilities in previous roles will have an impact on how much a church will consider paying you. When you bring greater knowledge and expertise to a position, it's fair to expect that it will be reflected in your compensation.

6. Regularly analyze pay. We all want our church to have the most engaging worship, the most capable pastor, the best children's programming and so on. We've talked a little about how to determine to pay for potential candidates, but the second half of this discussion is how to keep the people you hire.

We write a lot about creating and maintaining contagious office culture, but the truth is pay plays a factor as well. Be proactive about your staff's compensation. Good employees should be rewarded and reminded of their value. Assess performance and put plans in place to link performance to pay (think raises, bonuses and additional vacation/sabbatical time) at least once a year.

Analyze industry standards for similar roles in organizations within the size and scope of your church.

William Vanderbloemen is the CEO and Founder ofVanderbloemen, which serves teams with a greater purpose by aligning their people solutions for growth: hiring, compensation, succession and culture. Through its retained executive search and consulting services, Vanderbloemen serves churches, schools, nonprofits, family offices and Christian businesses in all parts of the United States and internationally. Follow him on Twitter @wvanderbloemen.

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