Note: MUST* and MUST NOT* (with asterisk) denotes legal requirement
MUST and MUST NOT (without asterisk) denotes requirement of the Code of Fundraising Practice
14.1 Legal References for this Section:
- Data Protection Act 2018
- Charitable Deductions (Approved Schemes) Regulations 1986
- Charities Act 1992
- HMRC payroll giving rules
The following Legal Appendices MUST be read in conjunction with this section of the Code of Fundraising Practice
14.2 Introduction and Initial Considerations
Fundraising within the workplace is varied in form and is subject to both direct legislation and self-regulation. This Code specifically addresses donations made directly from an employee’s salary. This could take the form of:
- Payroll Giving: a tax-effective scheme whereby the donation is taken from an employee’s pay before tax is deducted; or
- Post-tax salary donations: where employees’ donations are taken directly from their salary after tax has been deducted.
“Payroll Giving Agency (PGA)”: agencies that are registered charities who receive the donation from the employer and forward it to the beneficiary organisation on behalf of the donor.
“Fundraising Organisation”: all charities, social enterprises, universities, NHS trusts etc who will benefit from fundraising efforts made by their staff or external fundraisers.
“External Fundraisers”: are either individual professional fundraisers or professional fundraising organisations (PFO’s) that are hired by the beneficiary organisation to undertake fundraising on their behalf.
“Fundraiser” Any individual soliciting donations (including External Fundraisers).
14.2.2 Pre-Tax Payroll Giving
a) Employers using the payroll giving scheme MUST* have a written agreement in place with a PGA.
b) Fundraising Organisations/employers MUST* not offer benefits for donations received via pre-tax Payroll Giving, or overrule an individual employee’s decision as to where their donation goes.
c) Fundraising Organisations MUST* comply with the requirements contained in The Charitable Deductions (Approved Schemes) Regulations 1986 and subsequent amendments.
d) If Fundraising Organisations/employers are going to highlight the different levels of tax relief, they MUSTensure fundraisers have up to date information from HMRC.
e) Fundraisers MUST ensure that donors are aware that, following a Payroll Giving promotion, they are still free to elect to give to any fundraising organisation of their choice.
14.2.3 Post-Tax Donations from Salary
a) Where External Fundraisers who fall within the legal definition of a ‘professional fundraiser’ (L8) are used to take and process the donation or claim back the tax, a written agreement with the fundraising organisation MUST* be in place.
14.3 Promoting Committed Giving in the Workplace
14.3.1 Establishing the Fundraising Relationship
a) Before any approaches to solicit donations are made to a group of employees, Fundraisers or Fundraising Organisations MUST agree conditions of access with the relevant employer.
14.3.2 Fundraising Activity in the Workplace
a) Fundraising Organisations MUST* ensure that all materials, especially completed donor forms, are held securely and in accordance with their obligations under data protection law.
Section 5: Personal information and Fundraising includes further information on requirements relating to data protection.
b) Fundraisers MUST* wear photo identity badges provided by the organiser of the activity, or the relevant fundraising organisation(s) in a visible place at all times.
c) Fundraising Organisations MUST ensure that sufficient safeguards exist and are followed throughout the solicitation process to avoid pressurising potential donors, though reasonable persuasion can be used.
d) Fundraisers MUST ensure that donors are aware that they have the right to terminate an agreement to donate to a Fundraising Organisation at any point.
14.3.3 Using External Fundraisers
This section should be read in conjunction with the section Working with Third Parties.
a) External Fundraisers (who fall within the definition of a ‘commercial participator’ L9 or ‘professional fundraiser’ L8) hired by Fundraising Organisations MUST* have a written agreement with the organisation they are representing.
b) External Fundraisers (who fall within the definition of a ‘commercial participator’ or ‘professional fundraiser’) hired by Fundraising Organisations MUST* make legally compliant statements as to how they are paid.
c) External Fundraisers MUST agree in advance with Fundraising Organisation clients all procedures, including the processing of donors’ details, and fundraising materials.
d) Fundraising Organisations MUST provide external fundraisers with necessary information about the Fundraising Organisation’s objectives and clear guidelines about conduct and the different tax reliefs in this area.
e) External Fundraisers MUST process information as swiftly as possible and ensure that information relating to new donors is passed to the Fundraising Organisation as soon as possible.
f) If External Fundraisers are representing multiple organisations, they MUST ensure all Fundraising Organisations are represented in an entirely neutral manner.
14.4 Payroll Giving Agencies
PGAs receive employees’ donations, which have been deducted by the employer from the payroll, and distribute these donations timely and efficiently to the relevant fundraising organisations.
Legal and best practice guidance for PGAs can be obtained from the Association of Payroll Giving Agencies(APGO)
The Charitable Deductions (Approved Schemes) Regulations 1986 place certain requirements on employers, which are not mentioned here, but maybe useful/necessary for employers/fundraising organisations to be aware of.