WLF LEGAL AUDIT -- Preview Checklist
WLF uses a comprehensive tool for monitoring a church’s legal health called a “legal audit.” The following sample is a very abbreviated 10-question legal audit which is easy to complete and will introduce you to a few of the subject areas covered by such legal audit.
1. Have your employment manuals, contracts and interview forms been reviewed by legal counsel to eliminate unintended contractual undertakings and minimize liability for wrongful discharge claims?
__ Yes __ No
2. Does your organization distribute voter scorecards or political candidate comparisons before elections, and if so, have they been reviewed by legal counsel for compliance with the IRS ban on candidate endorsements or regulations on lobbying activities? Are you aware of the IRS Political Activity Compliance Initiative for the 2008 election?
__ Yes __ No
3. Do you treat any of your workers as independent contractors? Have you reviewed the 20-point test the IRS uses to determine whether a worker is truly an independent contractor, or is in fact an employee?
__ Yes __ No
4. Does your organization make any interest-free loans to employees, directors or officers? If so, are you aware of IRS rules regarding such loans?
__ Yes __ No
5. Does your organization promote publications of an employee/author, and does it have a policy for royalty income and copyright ownership, to avoid claims of excessive private benefit?
__ Yes __ No
6. Does your organization provide every newly hired employee with Form I-9, and required the new employee to complete Section 1 by the end of the first day of work, in compliance with the Immigration Reform and Control Act.
__ Yes __ No
7. Does your organization have a policy for determining who is authorized to communicate with the media, the IRS, or other government agencies, in the event of a problem or investigation?
__ Yes __ No
8. Has your organization offered room, meals orother benefits to volunteers, and does this convert them to “statutory employees?”
__ Yes __ No
9. Has your organization conducted an objective risk management survey and insurance review in the last 3 years?
__ Yes __ No
10. Does your organization have a written policy regarding sexual harassment, with a grievance procedure, and do you provide regular training to employees, in order to preserve the corporate defenses allowed by the U.S. Supreme Court?
__ Yes __ No
Scoring: Maximum Best Score: 10 Yes answers
8– 10 Good Work! Keep your "legal health" a priority with regular check-ups.
6– 7 On track, but should verify "legal health" with regular check-ups.
4– 5 Act Now! Make a legal audit an agenda item at the next board meeting and a management priority.
2– 3 Emergency treatment required!
0– 1 Likely target for church lawsuit. See you in court!