And a Small Guide to Volunteering and Liability
In the past weeks a member of our community raised questions about the structure reform and of potential issues with liability.
In the process of investigating these claims, and in dialogue with our Law firm (www.wtplaw.com) and our insurance broker (www.austin-co.com), I realized that very few of our volunteers actually understand the liability question that follows from being a volunteer in a non-profit like Open Source Matters.
In the next section I will explain the claims made and the answers and then move on to a general informational chapter on Volunteering & Liability.
The claim made against the Structure Proposal was focused on the question if new OSM Directors being elected in each department and operating as Department Coordinators would have a double role that would make them count as Employees under the New York State law. A consequence of that would be that they would no longer be independent Directors of the board, and that it would also constitute a problem in terms of liability.
However, going over the claim with our lawyers and insurance broker there are some key elements.
- All volunteers in Open Source Matters from working groups to directors are in fact Volunteers and not employees.
- All volunteers, and specially Officers and Directors (D&O) are covered by our insurance – which is a standard non-profit organization insurance as its normal in the US (coverage for all + special D&O coverage).
- Officers & Directors of the board can be volunteers on multiple levels in the organization without becoming “employees” or “dependent” as long as they are volunteers and not paid employees.
- Even _if_ they were a “dependent” Director i.e. an Employee representative in the Board of Directors they would still be OK and would still be covered by insurance.
- Even _if_ they were to be counted as Employees they would still be covered by our insurance
- Even _if_ they would be to have a double role that would make them employees and so not independent directors the remaining 4 Officers would still constitute independent directors and yet the board would have at least 1 independent Director, which is all it needs in reality.
- Even _if_ a double role would have made a Director count as an employee this would already have been the case in OSM since day 1 when OSM was created.
To clarify some things about volunteering, liability and background:
Open Source Matters Inc. is based in New York in the USA.
There is a federal law called the Volunteer Protection Act that in much detail protects volunteers against liability and claims when doing voluntary work. (http://www.gpo.gov/fdsys/pkg/PLAW-105publ19/pdf/PLAW-105publ19.pdf)
That means that the Act provides liability protection for volunteers under the following conditions:
- The volunteer was acting within the scope of the volunteer’s responsibilities in the non-profit organization or governmental entity at the time of the act or omission;
- If appropriate or required, the volunteer was properly licensed, certified or authorized by the appropriate authorities for the activities or practice in the State in which the harm occurred, where the activities were or practice was undertaken within the scope of harm occurred, where the activities were or practice was undertaken within the scope of the volunteer’s responsibilities in the non-profit organization or governmental entity;
- The harm was not caused by willful or criminal misconduct, gross negligence, reckless misconduct, or a conscious, flagrant indifference to the rights or safety of the individual harmed by the volunteer;
The Act does not affect that “liability of any non-profit or governmental entity with respect to harm caused to any person,” nor does it affect a governmental entity or non-profit’s taking civil action against any volunteer of the non-profit. For more information, see US Public Law No: 105-19.
A bit more background etc. can be found here: http://www.npccny.org/info/gti2.htm
New York has its own amendments and state laws too, as do all US states – in general any Federal law will supersede any state law but there are some modifications here.
If you read the following publication (I would suggest first couple of chapters and then go to Page 74) http://www.iyi.org/resources/mentor/pdf/Liability%20Laws%20Overview.pdf.
General chapters give a good understanding and as you can see on page 74, for New York there really aren’t many changes that affect us (as we are not voluntary fire fighters).
However N.Y. Not-for-Profit-Corp. Law § 720-a confers qualified immunity for uncompensated officers and directors of certain not-for-profit corporations as of 2002, and can be read in detail here: http://www.dfs.ny.gov/insurance/ogco2002/rg203061.htm
Full law text for 720-a can be found here: http://codes.lp.findlaw.com/nycode/NPC/7/720-a.
The full law text for Not-for-Profit Corp. Law for New York can be found here: http://codes.lp.findlaw.com/nycode/NPC.
A general and in detail read on liability for not-for-profit organizations and insurance of same can be read here: http://www.icnl.org/research/journal/vol4iss2_3/art_3.htm.
A copy of our insurance policy for Open Source Matters, Inc. can be found here https://drive.google.com/open?id=0B5YM847DtmTJM0NHTXAxSmdJQms&authuser=0.
It has been highlighted to underline the sections that are interesting in relation to this post.
On behalf of the Structure Team
Ronni K. Gothard Christiansen