Despite this mostly mission-driven work – uplifting souls and affecting good works in the community – church administration is also rife with legal and ethical complications.
In some countries, such as the UK, where churches are often registered as charities, there is a heightened obligation to comply with a wide range of legal and ethical codes of conduct, and it is the purpose of this article to address the key areas of legal and ethical management in the church, both to assist church leaders and administrators understand their duties, and to provide the basis for wider discussion.
Understanding Legal Obligations
From charity law to employment law, a church’s legal context in the UK is broad. The Charities Act is one such aspect of law to which churches must account. This means that churches have to be transparent about their finances, fundraise properly, and comply with data protection law such as GDPR. They must also observe their responsibilities as employers and their duties under health and safety law.
Ethical Fund Management
Donations and funds should be handled with professionalism, for example, by investing it for the benefit of the church and its members. Money received by a church should be accounted for, with clear records kept of incoming and outgoing funds. Donations should be spent exactly as intended. Gifts made to fund construction of buildings should not be diverted elsewhere. Personal gain should not be taken from the budget. Financial processes should be open and transparent, and should not allow for any conflict of interest.
Volunteer and Staff Management
For example, while volunteers can be a great strength of churches, they can also bring legal and ethical challenges, especially with regard to safeguarding policies, background checks and training, as well as for staff who work for the church on an employed basis (eg, a vicar) in terms of ethical employment practices in terms of hiring, just remuneration and safety in the workplace.
Data Privacy and Protection
Churches now collect and store all kinds of personal data. In the digital age, we should be compliant with data protection rules. These include keeping personal information secure, clearly stating how data is used, and implement the rights of the data subjects.
Utilising Church Management Software
In addressing these legal and ethical challenges, church management software UK churches use can be invaluable. Such software can streamline administrative tasks, aid in maintaining accurate records, ensure compliance with data protection laws, and manage finances and donations effectively. By automating and organising various administrative functions, church management software helps church leaders focus more on their pastoral duties and less on bureaucratic complexities.
The legalities of church administration
This career guide outlines the major differences when assuming the roles of managing a church as a non-profit organisation compared with running a general charity in the UK.
To begin with, when running a church, it is crucial to pay attention to both the clarity of the church’s mission and internal governance that can aid the church in achieving its goals. In addition to this, unlike general charities, churches are not considered to be legal entities and therefore not required to be registered.
Moving on to general charities, the key factor when running one is to understand and comply with all necessary UK laws to avoid legal violations. Any charity needs to be registered with the UK charity commission and has to annually submit an annual return, including the organisation’s accounts.
Legal Structure and Governance: churches have a number of choices in terms of legal structures for their charitable activities: charitable incorporated organisations (CIOs), companies limited by guarantee, unincorporated associations, and trusts. Each has implications for how documents are signed, for individual liability, and to whom and when reporting is required.
Public Benefit Requirement: An entity can be a charitable body under the Charities Act 2011 (which essentially codified existing common law) only if its activities are for legal purposes described in the Act and for the public benefit. The Act revoked the presumption of public benefit in the case of those charities with a ‘sole object of the advancement of religion’ (a category that applies to most churches), leaving it to the Charity Commission and the courts to determine whether or not they comply. This has increased the chances that a religious charitable body will be required to establish public benefit.
Eligibility for Public Sector Grants: Churches might struggle to satisfy the eligibility requirements for public sector grants (for example from local authorities) because the standard form of the documents through which churches set themselves up will not contain the provisions that the grant-awarding bodies require.
Trustees and leadership At a faith charity (and often a church in particular), the governing document might require trustees to sign a document that expresses adherence to a faith, or even to be members of the faith organisation. It might also say that religious leaders can be trustees – subject to normal trustee rules – so long as that’s permitted by the governing document. Trustees who are religious leaders will normally have the same power of decision-making as any other trustee, unless the governing document specifies otherwise.
Conflicts of interest: Both church and general charities must maintain a position where none of their trustees have conflicts of interest (or, if having such a conflict, avoid it influencing the trustee’s decision-making). This is especially true in faith charities, where faith convictions might overlap with decisions affecting how the charity is run.
This is why church administration entails a constant effort to ‘get it right’ legally and ethically. It’s a question of ministering to the wider community while also adhering to legal directives, managing funds ethically, and avoiding the pitfalls of poor administration – all with the support of appropriate technology, such as church management software. It is only by knowing the legalities of running a church in the UK, by observing and upholding the highest ethical standards of fund and people management, and by staying abreast of technological developments that churches in the UK can function as a centre of communal life, where spiritual matters are ministered to with integrity and responsibility.
