Bylaws Checklist
This checklist points out the necessary elements in bylaws. It’s important to also stay compliant with applicable state and city laws.
Article Highlights:
Necessary elements in bylaws
The very mention of bylaws in a board meeting is usually met with dread. It typically means either that a conflict has risen to the point where the bylaws must be consulted, or it means that someone is pointing out an area of noncompliance that has gone unnoticed for years.
This Checklist points out the necessary elements in bylaws.
Because regulations about nonprofit bylaws are done individually by state (rather than the federal government) there is quite a bit of variation. For example, in Ohio and New York, nonprofit boards must have a minimum of three members, but in California the minimum is one. It’s important to obtain the applicable state laws and make sure that the bylaws are in compliance.
In addition, some cities have further regulations for nonprofits. Ask your city attorney’s office for guidance. For example, some states and cities have different rules for nonprofit organizations for which the board automatically includes an elected official or government employee as a result of that individual’s election or employment.
Three overall guiding principles for nonprofit bylaws
A. Don’t put too much in the bylaws. If you specify a board committee in the bylaws, for instance, and there hasn’t been such a committee in a few years, someone could claim that you are in violation of your own bylaws. Or, along the same lines, if the bylaws state that meetings will be held on the third Wednesday of each month, you can’t change to Thursdays without a change in the bylaws.
B. Remember that if trouble erupts — such as internal conflict or attacks from others — the bylaws will become very important. So make sure they are reviewed approximately every three years. Because board officer terms make it hard for the board to keep track of bylaw revisions, have this duty included as a responsibiity of the executive director.
C. Immediately attach (by staple if necessary) any changes made to the bylaws to the copy kept by the executive director. Too often everyone forgets about changes to the bylaws.
The most important provisions for your bylaws
Here is a checklist to ensure the most important provisions are included in your bylaws.
- Indemnification. A statement that limits the personal liability of board members.
- Whether the organization has members (such as members of a neighborhood or professional association) and, if so, what their rights are. For example, in a true membership organization, members have the right to elect officers. Even if you don’t have members with legally enforceable membership rights such as voting rights, you can still have people called “members,” but the distinction should be clarified in the bylaws.
- Minimum and maximum number of board members. Example: minimum of five and a maximum of fifteen board members. Some states specify a minimum, and some specify a formula for a minimum and maximum, so check your state’s law.
- The number required for a quorum. A quorum is the minimum number of board members who must be present for official decisions to be made. For example, if an organization currently has fifteen members, and the bylaws state that one-third of the members constitutes a quorum, then official decisions can only be made at board meetings where five or more members are present. Note: Many states specify the minimum required for a quorum; for example, in California a quorum may be as low as one-fifth of the board.
- Terms and term limits. Example: two years, with term limits of three consecutive terms (making a total of six years); after a year off, a board member may be permitted to return. Similarly, terms can be staggered so that, for instance, one-third of the board is up for reelection each year.
- Titles of officers, how the officers are appointed, and their terms. Example: appointed by majority vote at a regular meeting of the board; an officer term is for one year with a maximum of two consecutive officer terms.
- Procedure for removing a board member or officer. Example: by majority vote at a regularly scheduled meeting where the item was placed on the written agenda distributed at least two weeks ahead.
- Conflict of interest policy. Alternatively, many bylaws simply state that there will be a conflict of interest policy but keep its exact wording out of the bylaws.
- Minimum number of board meetings per year. Example: four, with one in each quarter.
- How a special or emergency board meeting may be called.
- How a committee may be created or dissolved.
- What committees exist, how members are appointed, and powers, if any. It may be easiest not to specify committees in the bylaws at all; instead, permit the board to create and dissolve standing and temporary committees as it sees fit. As a result, the bylaws need not be changed each time a committee is created or changed.
- Conference calls and electronic meetings. Example: votes by e-mail or web forum are prohibited. Meetings may be held by conference call if all members can simultaneously hear one another. As Internet usage grows, some boards are adding sections to the bylaws that describe how to hold a board meeting on the Internet, or whether and how decisions can be made by e-mail.
- How the bylaws can be changed. Example: by majority vote at a regularly scheduled board meeting.
Each board member should be given a copy of the articles of incorporation, the IRS and state determination letters, and the bylaws. Some organizations also post their bylaws on a password-protected section of their website.
Every few years, review the bylaws. Occasionally, individuals are invited to join boards without much scrutiny and are later found to be disruptive and destructive. Too often the board looks to the bylaws to see how to remove such a person, only to discover that the bylaws were written twenty years ago (and seldom looked at since) and have no such provision. Appropriate changes to the bylaws should be recorded in the board minutes, added to copies of the bylaws, and, in some cases, reviewed by an attorney experienced in nonprofit law.
Also in Blue Avocado:
- Can Nonprofit Boards Vote by Email? by Gene Takagi & Emily Nicole Chan
- Boards Should Only Have Three Committees! by David Lapiana
- Board Terms: One Year – Three Years – Two Years by Jeanetta Issa
- Sarbanes-Oxley and Nonprofits: Bogeyman in the Boardroom? by Jan Masaoka
You might also like:
- Insider Newsletters: An Easy Way to Keep Your Board in the Loop and Engaged
- Board Horror Stories: How to Reduce Board Resignations
- Rebuilding Nonprofit Boards: When a New Board Can Be a Fresh Start
- Five Lessons for Creating an Effective (and Accountable) Nonprofit Board
- A Cautionary Tale: Overcoming Governance Nightmares in Nonprofit Organizations
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About the Author
Jan is a former editor of Blue Avocado, former executive director of CompassPoint Nonprofit Services, and has sat in on dozens of budget discussions as a board member of several nonprofits. With Jeanne Bell and Steve Zimmerman, she co-authored Nonprofit Sustainability: Making Strategic Decisions for Financial Viability, which looks at nonprofit business models.
Articles on Blue Avocado do not provide legal representation or legal advice and should not be used as a substitute for advice or legal counsel. Blue Avocado provides space for the nonprofit sector to express new ideas. The opinions and views expressed in this article are solely those of the authors. They do not purport to reflect or imply the opinions or views of Blue Avocado, its publisher, or affiliated organizations. Blue Avocado, its publisher, and affiliated organizations are not liable for website visitors’ use of the content on Blue Avocado nor for visitors’ decisions about using the Blue Avocado website.
My strongest recommendation about Bylaws is that you engage a PROFESSIONALLY CREDENTIALED parliamentarian to assist you with any bylaws issues — including a review. These individuals are professionally trained and credentialed and are the true EXPERTS in their field. Not using a professional parliamentarian can be costly in the long run — particularly if you are taken to court and the court wants an expert witness.
Two comments: First, I want to recommend two books. (1) "Managing the Nonprofit Organization" by Peter Drucker, and (2)"Managing a Nonprofit in the Twenty-First Century" by Thomas Wolf. These are the only 2 books that I know about focussing directly on nonprofit organizations and management.
Second. I wish someone would write coherently about the names of the Board officers. In most states, corporations have a President, Secretary, and Treasurer with restrictions on these. Boards have Chairs, Secretaries, and Committee Chairs. They do not have Presidents or Treasurers. In my experience, these titles are seldom used properly and the difference between Board officers and corporation officers is ill-understood. Finally, there is the management-speak officers, the "Cs", i.e., CEO,COO, CFO, etc. This should be sorted out.
Thanks for the book recommendations.
Re: board officer titles. I’ve been on nonprofit boards at local, regional and state level almost continually for 25 years as well as working for nonprofits for over 20 years, and have seen only one board that didn’t have someone titled “Treasurer”. I agree that the President/Chair is confusing, but one of my nonprofits has a President and two board officers and no Chair, so it’s a case of different strokes.
The bylaws for the nonprofit I currently work for (and was a previous board member for) specify that the position is Treasurer/CFO. This is to comply with the state requirement that the board have a Treasurer.
The board does have a Finance Committee but it is not specified that the Treasurer chairs the committee.
Peter Drucker is great and I also recommend Peter Brinckerhoff for nonprofit management! As a fundraiser, one item that should definitely be conveyed to board members is their requirement for donating to the organization. Kim Klein states, ” Each board member gives money and most of the board members help raise money,” (2000, p. 28). If the board is expected to donate, the board members should know this upfront. This stipulation may determine whether or not a member will be as dedicated to your organization.
A critical procedural recommendation — ALWAYS put the date of latest revision at the end of the by-laws document.
When another revision is made don’t remove the prior date, add the new one so you end up with: “7/04; 11/08; 3/10.”
That way if various Board members are referring to contradictory language from the “official” by-laws it is clearer to see which language comes from the most recent and therefore, current edition of by-laws.
I once tried to mediate a Board ruckus regarding how to elect officers. The knot finally unravelled when I realized everyone was reading from different versions of the by-laws. Problem was, none of the versions were dated so no one would concede which was the valid version. Avoid this scenario at all costs!
I also like to put a very brief summary of the changes that were made with each revision at the bottom. For example:
“Revised 4-20-10 — changed number of board members (Article III) and latest acceptable meeting date for annual meeting (Article V).”
That provides a “history” to the document.
Small nonprofit organizations that I am familiar with do not know what are in their own by-laws. The by-laws may have been written as an original requirement, but no one on the current Board knows what they are and if they need to do anything about them. There are wonderful suggestions here for books and contacting agencies, however if no one from the Board wants to learn anything new, they will just continue in the state of confusion that they are in.
It’s even true for larger organizations. I know one $7.5 million organization that does not have a copy of its by-laws. It’s possible to get a copy of the by-laws that were last filed with the organization’s state, but often they have been substantially updated since then but no one has a copy. This particular organization was founded in 1968 and the document they have says "1972 DRAFT."
I always thought that one of the reasons for the existence of bylaws was to serve as a “roadmap” for the agency. Therefore, you would want to be more specific, so you had a document to refer to, in case of questions.
Seems to me that other important provisions would be Duties of Board Members, Compensation, Agency Fiscal Year, and how to enact Amendments to the Bylaws.
Another book on non profit management is "The Board Member's Book" by Brian O'Connell. It is available through the Foundation Center. It deals with the role of board members, the relationship with staff, and fund raising. As to bylaws, a good place to look is Nolo Press which has put out many books on "do your own" law. It has books on forming and operating a non profit plus a lot of other information. Andy Anderson Listen for Life Foundation
Another book on non profit management is "The Board Member's Book" by Brian O'Connell. It is available through the Foundation Center. It deals with the role of board members, the relationship with staff, and fund raising. As to bylaws, a good place to look is Nolo Press which has put out many books on "do your own" law. It has books on forming and operating a non profit plus a lot of other information. Andy Anderson Listen for Life Foundation
how do you find the by laws by state?
Every state has an office in charge of charitable organizations, but these offices have different names in different states. Call the State Attorney General of your state and ask which office is the right one to consult regarding bylaw requirements for nonprofit, tax-exempt organizations. Good luck!
Do by-laws have to be approved by external agencies (ie state/federal level)? Or is this a purely internal operation?
I don’t know about all states, but in California the bylaws have to be approved only at the time of incorporation as a nonprofit corporation. Subsequent amendments and changes do not need government approval.
Do by-laws have to be approved by external agencies (ie state/federal level)? Or is this a purely internal operation?
I don’t know about all states, but in California the bylaws have to be approved only at the time of incorporation as a nonprofit corporation. Subsequent amendments and changes do not need government approval.
I’m curious whether anyone has any thoughts about the relationship between by-laws and certification of incorporation. I’m volunteering within a tiny group with some particularly ancient by-laws, which defer to the certification of incorporation for rules about things like number of trustees, how they should be elected, and the like. I would think that these might be more logical in the by-laws than in the certification of incorporation, but it seems to be how things stand at present.
Were we to change them, I’m assuming that the certification of incorporation is the binding document and that it would not be possible to have the by-laws override provisions in the certificate of incorporation. Am I wrong to assume that? If so, it would certainly be much easier to change the by-laws than it would to change the certification of corporation itself.
I’d appreciate any suggestions!
I’m curious whether anyone has any thoughts about the relationship between by-laws and certification of incorporation. I’m volunteering within a tiny group with some particularly ancient by-laws, which defer to the certification of incorporation for rules about things like number of trustees, how they should be elected, and the like. I would think that these might be more logical in the by-laws than in the certification of incorporation, but it seems to be how things stand at present.
Were we to change them, I’m assuming that the certification of incorporation is the binding document and that it would not be possible to have the by-laws override provisions in the certificate of incorporation. Am I wrong to assume that? If so, it would certainly be much easier to change the by-laws than it would to change the certification of corporation itself.
I’d appreciate any suggestions!
All of this is STUPID. Who the heck has time to fuss around with all this crap when you’re trying to save people and animals. Who ever made these rules ought to try managing the rules and the work the non-profit is trying to do. Once again… the rich keep getting richer while the poor slaves of the world drown in the paperwork.
I agree, but unfortunately we live in a world where people are sue happy, question everything due to mistrust, and won’t sumbit out of love for the organization to the aurthority placed over them as in yester years so I’m finding with my new non-profit org that you have to be very careful about everything you say and do, the laws, and make sure your attorney is specific and knows their stuff. It stinks but its the present day reality. It creates a lot of fear in us who want to better our communities and raise awreness to the needs.I own a preschool so know i speak from experience.
Actually, regardless of what good you’re trying to do in the world, going off half-cocked is why so many non-profits function so spectacularly badly. This is also one reason there are plenty of non-profits/NGOs duplicating the efforts of other non-profits/NGOs – and not getting more done in a real sense.
Actually writing down your process can be a great way to save time down the line. As long as you don’t drag on and on with doing the task.
Oh, and yes, I have worked for several non-profits and been on several boards. Sometimes, I just want to quit all of it because not enough people take time to get organized before going off on a manic martyr mission to “save the world.” Having a big heart isn’t the same as being good at it.
Hello.
I’m a member of a nonprofit organization incorporated in the DC. The Board put to stakeholders’ vote an amendment to the bylaws to change the stakeholders categories. The bylaws require that 3/5 of affirmative votes be obtained from the stakeholders present in the meeting where the vote took place.
The vote was announced via the association’s listserv, three days were allowed for voting, and the ballots (affirmative, negative or abstention) were cast via email to a specific address assigned by the Board.
Now, what stakeholders should be considered “present” in a vote organized in such manner? All recipients/participants in the listserv or only those who actually voted?
Any suggestions or case law on the matter will be most welcome.
I would say that those who replied electronically attended electronically. Others did not attend to the matter.
I would like to know if there is a agency or department I can have a concern i have addressed? I just left a board at a non- profit employer, this board is repeating the same bylaw violations year after year, their president and others keep voting themselves back into their positions with no reguards to their own bylaws, while other board members become fustrated and resign their positions due to this and other matters such as staff interfearance, financial discrepancies and just outright bulling.
Any assistance is welcomed as lower ranked board members love this organisation but need to see changes at the top for the benifit of this organisation.
In the United States, each state has a designated "charity official" to whom such complaints can be made. This official has a different title in different states, although they are often located in the state attorney general's office. You can find a list of the officials on the website of the National Association of State Charity Officials at www.nasconet.org. Hope this helps!
In the United States, each state has a designated "charity official" to whom such complaints can be made. This official has a different title in different states, although they are often located in the state attorney general's office. You can find a list of the officials on the website of the National Association of State Charity Officials at www.nasconet.org. Hope this helps!
Are there free sites to answer questions on non profits? I’m not having any luck with what I’m finding.
I need to know what percentage of a public charity’s funds must come from donors, grants, etc. to remain public? We have been told we need to change from public to private because our investment income was too much this year.
But what if that changes next year?
So if you have a nonprofit with unpaid board members, do officers have to be members of the board? Treasurer is a lot of work, can't there be a CFO paid staff member who is the treasure but not a board member? How can a volunteer do all that is required of the treasurer? And can staff be on the board? california i think say yes as long as the majority of the board is Unpaid thanks!!
Gee, we're not up on the latest of Nevada law. I'd recommend talking to a more local lawyer in your state. Here's some general guidance from a past Blue Avocado article: https://www.blueavocado.org/content/bylaws-checklist
Thank you for your response. Our Bylaws do not define a quorum and from what I gather from the Arizona statutes, our bylaws dictate what a quorum is to be. Given that no definition is given in our bylaws and until we can amend them, would we consider a quorum to be determined by the number of members we actually have or by the number there should be?
I would check with a attorney who specializes in nonprofit law to make sure the quorum question is NOT covered.
Otherwise, make a few suggestions for a quorum rule at a board meeting and have the board vote on it.
In almost all instances, nonprofit board meetings are not required to be open to the public. Remember: the nonprofit sector is actually part of the PRIVATE sector.
There are a few exceptions. For instance, if you receive $250,000 or more in contracts with the City of San Francisco, you have to make two board meetings per year open to the public. To be triple sure you might want to check with local or state authorities. But the default rule is: not required to be open to public.
We only have six members and currently no operating rules for our nonprofit. We are still in our
first year. We know that someday we’ll have to deal with bylaws,nonprofit status and a board
of directors. My questions are: With a group this small can members do dual duties such as
Sec/Treasure? How long can we continue to operate with a Executive Director in the position of
Chair of Board,President/vice-president etc?. Any major decisions go before the membership and they
determine what the course of action will be.
We only have six members and currently no operating rules for our nonprofit. We are still in our
first year. We know that someday we’ll have to deal with bylaws,nonprofit status and a board
of directors. My questions are: With a group this small can members do dual duties such as
Sec/Treasure? How long can we continue to operate with a Executive Director in the position of
Chair of Board,President/vice-president etc?. Any major decisions go before the membership and they
determine what the course of action will be.
Our small non-profit has no Directors, just what is called the
Executive Committee which has a Pres., VP, International VP, Treasurer & Secretary. By-laws have wording regarding the Directors and it was stated that we needed that in bylaws for the future as it was easier to put it all in now, rather than later. Problem is that there are no clear rules regarding what the EC can or cannot do, like assign a member if there is a vacancy on the EC. Just says that EC members are elected members that can assign committee chairs etc. Current EC is trying to fill VP spot with a close friend…..
If a board member resign before term is up can they run again?
This would be determined by each organizations specific policies and/or bylaws. Perhaps someone else has a more specific answer.
do I need all of this to run a sober home
Any responsible nonprofit should have these provisions in bylaws, no matter what the mission.
Can a board member also be a President in the same Non-Profit organization he is running. I have a issue with a non-profit going where the board members are also operating as Corporate Officials so there is no way anyone can apply and get into positions available. The president has hired his wife as secretary his cousin as the Treasure and best friend under another position . So they do everything they want with no repercussions, cause they work together which is wrong just do not know how i go about getting the right forms and speaking up
To be clear, by President we assume you mean Executive Director or CEO vs. Board Chair. In general, it’s fairly common for the leader of a small nonprofit to be on the board, although it’s best practice for them not to serve as Chair, and also to recuse themselves from any conversations about their own compensation. It’s also common for nonprofit startups to stack the board with friends and family, although the IRS considers relatives of any employee as “interested parties” and they must comprise no more than half the board, so if your board only has 3 interested parties plus a friend, that’d be 75% and you’d need to either remove some of them or find 3 new non-interested parties to add. Fixing this should fix the lack of accountability and ensure the organization is more properly stewarded!
Our by-laws were created several years ago and amended just a few years ago. In the amendment, there were organizational issues (e.g. the separate areas of the by-laws are labeled incorrectly (Roman numerals were skipped, bullet points aren’t in alphabetical order). In Indiana, do we need to have the approval of a lawyer to make these corrections? I have done some research but can’t find a clear answer.
Can a person on a not for profit board conduct business out of a property owned by that not for profit. example, a local baseball, softball organization rents out cages to help offset operating costs. Can a board member rent these cages out with the express reason of generating personal income by offering hitting/fielding lessons? does this put the board into jeopardy by chance ?
We are starting a nonprofit Art Center. It is currently my husband, myself, and our close friend. We do not have a board, it is just us. We are wearing ALL the hats. How do we structure this? Do you need a board for a nonprofit?
Also, I own most of the large equipment that we will use in the nonprofit. Can I rent the equipment from my for profit company to the nonprofit? For a minimal fee, like $50 a month?
Thank you for mentioning that when you are voting on removing a board member you have to have the vote placed on the agenda at least two weeks prior. My mom is trying to get one of the members of her non-profit’s board removed and so she will need to put it on the agenda. I will send her this article so that she can review the bylaws.
does the words By-Laws be also called rules and regulations of the Tenant Association instead of by-laws. We are a small community and would like to know if this is legal and or right to call then rules and regulation of the association. thank you
does the words By-Laws be also called rules and regulations of the Tenant Association instead of by-laws. We are a small community and would like to know if this is legal and or right to call then rules and regulation of the association. thank you.
Is a California 501c3 required to make the following available to the public?
bylaws and organizing documents
board meeting agendas and minutes
Thank you