Ministry is a high calling. Most of our servant leaders could command a higher salary in the for-profit world, but they have chosen to use their gifts and talents to serve the Lord. The conviction to “call” and to service that they bring often makes ministry personnel reluctant to converse openly about compensation issues. It is up to the good leaders of the church to address these important issues. It is the church’s obligation to provide proper salary and benefits to its employees.
What is proper compensation? The church setting is indeed unique, and often a helpful question for church leaders to ask is “What would persons carrying similar responsibilities in other vocations be paid?” In your community it might be appropriate to gather information on the salaries and benefits of teachers, administrators, CEOs, counselors, and service providers.
It is common to find congregations that lump together the “costs of a minister” with the “costs of ministry” in their budget. These are two very distinct concepts. For proper planning it is best to keep them separate.
Often ministers will ask Servant Solutions for help when a church extends a call and says to the new pastor something like this… “We have $XX in our budget for the pastor. You decide how you want this broken down.” Servant Solutions strongly discourages this practice. The church has no idea whether compensation is adequate or not when these costs are commingled. Also, mixing the two may confuse or mislead church members as to the level of compensation the minister is receiving. It is a wise church board who will take the time and effort to gather the information and knowledge to make sound decisions. In the descriptions which follow, you will gain an idea of why it is important to separate administrative expenses from salary and benefit expenses.
COST OF MINISTRY
The cost of ministry includes those costs related to the work of the minister and is properly a part of local church expenses. Among these are the expenses that will be incurred without regard to which minister is serving the congregation at a particular time. While they are important expenses in carrying out ministry, the minister does not personally accrue a financial benefit from the dollars expended in this area.
The expenses incident to the carrying out of ministry by the minister should be treated as business and professional expense reimbursements. This assures that the minister does not have to take these costs out of his or her pocket. Examples of these types of expenses are:
auto expense, continuing education, convention, hospitality, pastor’s professional library, dues to professional organizations, church supplies (including postage, birthday cards, etc.)
COST OF THE MINISTER
The cost of a minister relates to those items that are directly and indirectly related to compensating the particular pastor serving the church at the current time. These costs include the general categories of the minister’s cash salary, housing allowance, and employee benefits.
Among the factors that should be considered in the process of providing the minister’s compensation package are:
the job requirements, the individual’s professional qualifications, educational background, personal experience and expertise, socioeconomic factors affecting pay in the local community, and such factors which merit pay for a job well done.
Servant Solutions, as part of our ministry to the church, stands ready to help your congregation in any way possible. On the Servant Solutions website you will find a number of compensation topics covered in the “Toolbox Series”. We also invite you to visit our Church Compensation Planning page at servantsolutions.org. There you will find additional resources that we have found to be reliable and helpful. If these resources do not meet your needs, Servant Solutions can prepare a rough estimate for specific positions. Visit the Church Compensation Planning page to get the process started.