How Does Payroll Giving Work for School Fundraisers?

Payroll giving is an innovative and effective fundraising strategy that allows employees to contribute a portion of their salary directly to charitable organizations, including school fundraisers. This structured program not only provides a consistent revenue stream for schools but also enhances donor engagement and simplifies the giving process for employees.

By leveraging an easy and seamless way for supporters to contribute to school fundraising efforts, payroll giving ensures that donations are regular, dependable, and impactful. In this article, we will explore the mechanics of payroll giving, its benefits for schools, and best practices for implementing it in school fundraising efforts:

• What is Payroll Giving?
• How Does Payroll Giving Work?
• Benefits of Payroll Giving for Schools
• Implementing Payroll Giving in School Fundraisers

The simplicity and reliability of payroll giving provide both schools and donors with a hassle-free experience, making it easier to support school fundraisers and enhance educational opportunities for students. In the following sections, we will dive deeper into how payroll giving works, the specific advantages it brings to schools, and how you can utilize these programs successfully for your own school’s fundraising efforts.

What is Payroll Giving?

Payroll giving is a simple yet highly effective charitable donation program that allows employees to donate a portion of their salary directly to a nonprofit organization, including schools. Employees authorize their employer to automatically deduct a set amount from their paycheck, which is then donated to a charitable cause. This method of giving is particularly beneficial for schools, as it creates a steady, predictable source of funding while simultaneously fostering a culture of giving among staff members.

Payroll giving can take different forms, such as:

• One-Time Donations: Employees may choose to make a single contribution to a specific cause or school fundraiser.

• Recurring Donations: Employees may choose to set up ongoing, automatic deductions from each paycheck on a regular basis (e.g., monthly or bi-weekly).

This automated process eliminates the need for employees to write checks or make manual payments, allowing them to contribute effortlessly and consistently. Plus, many companies offer matching gift programs, too, where they match the payroll donations made by employees, effectively doubling or even tripling the impact of their contributions.

How Does Payroll Giving Work?

The process of payroll giving is straightforward and involves several key steps that ensure both employees and schools benefit from the program. Here’s how payroll giving works in practice:

School Registration Process

In order for schools to be eligible for payroll giving programs, they must first register with a platform that manages the giving program. Several major platforms, such as Benevity, YourCause, America’s Charities, and CyberGrants, facilitate payroll giving through businesses and nonprofits. To register, a school needs to provide basic information about the organization, such as its mission, tax-exempt status, and payment details for receiving donations. Once registered, the school becomes available for employees to select as a recipient of payroll giving contributions.

Donor Enrollment Process

For employees to participate in payroll giving, they must complete a payroll deduction form provided by their employer or the program’s platform. This form will include the following information:

• Donation Amount: The employee specifies the portion of their salary they wish to donate, whether it’s a fixed dollar amount or a percentage of their salary.

• Donation Frequency: The employee indicates how often they want the donation to be deducted, typically either per paycheck or monthly.

• Designated Charity or School Fundraiser: The employee chooses where their donation will go, selecting the school or a specific fundraiser the school is supporting.

Once the employee submits this form to their employer, the payroll giving process is set up, and the employee’s contributions are automatically deducted from their paycheck.

Deduction and Remittance

After the employee is enrolled in the payroll giving program, the employer deducts the specified donation amount from their paycheck before taxes are applied. The deducted funds are then remitted directly to the designated school or nonprofit organization. This process ensures a seamless and hassle-free experience for both the employee and the school, as there is no need for manual intervention or periodic payments.

Bonus: Tax Benefits + Matching Gifts

One of the main advantages of payroll giving is the immediate tax benefit to employees. Since donations are deducted before taxes are applied, employees can reduce their taxable income right away. This tax benefit makes payroll giving an attractive option for many employees because it provides instant financial relief, eliminating the need to wait until the end of the year to claim the deduction.

Not to mention, in addition to the employee’s direct contribution, many companies also match the donations made by their employees. These matching gifts can double, or in some cases, even triple the amount that the school receives. When schools encourage payroll givers to take full advantage of matching gifts, they can significantly increase the total funds raised through payroll giving.

Benefits of Payroll Giving for Schools

Implementing payroll giving programs offers schools numerous benefits that go beyond simply securing funds. By incorporating payroll giving into school fundraising efforts, schools can build a more sustainable and engaging way of collecting donations from staff. Here’s how payroll giving can benefit schools:

Steady Revenue Stream

Payroll giving provides schools with a predictable and reliable source of income. Since donations are deducted directly from employees’ paychecks, schools can count on regular contributions, which improves financial stability and planning. This consistency is especially helpful for long-term projects, ongoing programs, or school needs that require ongoing funding. With payroll giving, schools don’t have to rely solely on sporadic fundraising events or campaigns to meet their budgetary needs.

Enhanced Donor Engagement

Payroll giving encourages ongoing engagement and strengthens the relationship between schools and their staff members. When employees are able to contribute automatically on a regular basis, they are more likely to remain committed to supporting the school’s goals. The convenience of payroll giving fosters long-term donor retention, which is crucial for schools that need stable, ongoing funding.

Additionally, payroll giving fosters a sense of community and ownership among employees. It’s not just about donating money—it’s about contributing to the success of the school and the students it serves. This shared sense of responsibility can help employees feel more connected to the school’s mission and more invested in its success.

Employer Matching Opportunities

The potential for matching gifts can greatly amplify the impact of employee contributions. Many employers offer matching gift programs, which means they will match the donation made by an employee, often dollar for dollar. Some employers may even offer higher matching percentages, effectively doubling or tripling the contributions. Schools should promote matching gift opportunities to maximize the total funds raised through payroll giving.

In many cases, the process of applying for matching gifts is simple and straightforward. Employees can submit a matching request through the company’s payroll giving platform or human resources department. Schools can facilitate this process by providing employees with the necessary information and ensuring that they are aware of the matching gift program’s existence.

Implementing Payroll Giving in School Fundraisers

To successfully implement payroll giving, schools must carefully plan their approach and ensure they have the necessary systems in place to encourage participation and maximize donations. Here are a few best practices for implementing payroll giving programs in schools:

Clear Communication

One of the most important factors for successful payroll giving implementation is clear communication. Schools should provide detailed information about how the payroll giving program works, the impact of donations, and the benefits of participating. This information can be distributed through emails, newsletters, staff meetings, or even informational sessions that explain the program’s mechanics and advantages.

Clear communication also includes emphasizing the ease and convenience of payroll giving. Many employees may be unaware of the simplicity of this process, so schools should take the time to outline the steps for enrolling, the tax advantages, and the positive effect their donations will have on students and school programs.

Payroll Giving Database Tools

To make it easier for donors to find payroll giving opportunities, schools should use an online corporate giving database like Double the Donation. This database solution provides employees with a tool to identify companies that offer payroll giving programs, plus matching gifts and volunteer grants, helping to streamline the process for both donors and schools. By embedding this database on the school’s payroll giving page, schools can ensure that employees have easy access to the resources they need to get started.

Exclusive Incentives

Incentives can play an important role in encouraging employee participation in payroll giving. Schools should consider offering small rewards or recognition to employees who sign up for the program or who meet specific donation goals. For example, employees who contribute a certain amount might receive a thank-you note, special recognition in a school newsletter, or even be entered into a raffle for a prize.

Regular Updates and Recognition

To maintain donor engagement, schools should keep participants informed about how their contributions are being used. Regular updates about the impact of their donations (whether it’s funding a new computer lab, supporting after-school programs, or providing scholarships) help employees see the tangible results of their giving. Acknowledging donors through thank-you notes, public recognition, and newsletters is also essential for building strong relationships with participants and ensuring continued support.

Conclusion

Payroll giving is a powerful and efficient tool for schools looking to enhance their fundraising efforts. By making giving automatic and convenient, payroll giving programs encourage staff members to contribute consistently and meaningfully to the school’s success. The benefits for schools are clear: it provides a steady revenue stream, enhances donor engagement, and strengthens community ties. When implemented effectively, payroll giving can become an integral part of a school’s fundraising strategy, offering a reliable source of funding and a way to foster a culture of giving within the school community.

Drive More Payroll Deductions with Double the Donation

Ready to take your school’s fundraising to the next level? Partner with Double the Donation and discover a wealth of payroll giving opportunities at your fingertips. Our comprehensive database and tools will help you identify and follow up with potential payroll giving donors with ease.

Get a demo of Double the Donation today and start transforming your school fundraisers with the power of corporate giving.