Workplace giving – sometimes called payroll giving – allows employees to make regular donations to charities through their pay pre-tax. Many of these employee donations are matched dollar for dollar by their employers.
It is estimated that $20 million is contributed to charity each year through workplace giving programs. More than $50 million has been donated to community organisations through programs facilitated by ACF since it was established in 2003.
However, prior to this research the net benefits of workplace giving were unknown. There was some concern that the employee donations were ‘taking from Peter to pay Paul’, with those giving through payroll deductions reducing their donations outside the workplace. For the first time this study shows that is not the case – indeed the reverse is true.
CEO of ACF Ted Kerr hopes this news will encourage employers who don’t currently offer workplace giving programs, to do so.
“We know that nearly two thirds of organisations without workplace giving programs have never heard of them. If just ten per cent of working Australians made a payroll charity donation of $5 a week, the Australian community would benefit by more than $260 million each year, before taking into account employer matching. Imagine the difference that could make in the community. It would mark a transformational change in the funds available to Australian charities,” he said.
ACF marketing and research project manager Mei-Ling Ho said “prior to our research we had more questions than answers. The big question everyone kept asking us was does workplace giving increase the size of the fundraising pie. While we believed it did, we didn’t have the hard evidence to back it up. Now we can tell people with confidence, yes – it does.”
“Just as importantly, by listening to employees, senior leaders and charities about what matters most and why, we’ve gained the insights we need to take workplace giving to the next level in Australia,” she said.
Toby Hall, CEO of Mission Australia said “This is exciting news. From an efficiency perspective we’ve always known how important workplace giving is to non-profits. Workplace giving has created an annual income stream of several hundred thousand dollars for Mission Australia. As a low cost form of fundraising this has allowed us to put nearly every cent into programs to help the most disadvantaged in Australia.
“This consistent donation stream allows us to plan for the long term, which is invaluable. But now we know it’s unleashing an untapped stream of income, which is incredibly welcome news for the non-profit sector. This tells me we need to increase our level of focus on workplace giving and really get behind this as a fundraising stream. It is a true example of one Australian giving another a go.”
Macquarie Group Foundation Professor Peter Shergold, head of the Centre for Social Impact, believes workplace giving’s potential will be realised only if all sectors collaborate to drastically build awareness and uptake. He believes that governments can play an active role in helping to incentivise employers to implement programs, and to encourage employees to participate.
“Internationally, we have seen government initiatives help increase the penetration of workplace giving programs. We would love to see some of these initiatives implemented in Australia, with governments actively promoting a giving culture.”
The study also showed that for 60 per cent of employees, employer matching of their donations is the primary motivation for giving through the workplace, making the program more compelling, and reinforcing the organisation’s commitment to supporting the community.