According To The New York State Non Profit Revitalization Act
Summary: The New York Non-Profit Revitalization Act requires fair and reasonable compensation for nonprofit employees based on the services provided. Analysis of data from 14,765 organizations showed a decrease in CEO pay of 2-3% after the law was adopted. Independent directors can now receive fixed or non-negotiable payments, and the audit committee must consist of independent directors. The law also requires a review of board performance and approval for non-substantial real estate transactions. Recent amendments clarified and extended the effective date for prohibiting employees from serving on the board. A summary of relevant statutory and case law in New York includes potential liabilities for non-profit organizations.
The New York Non-Profit Revitalization Act requires the board of directors to review and approve the salaries of executive staff, including the CEO and any other officers. Additionally, under this act, it's mandated that compensation for services rendered by executive staff must be fair and reasonable, and it imposes certain requirements on the board's composition and procedures. The law also demands the review and approval of compensation levels and policies annually.
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