Nonprofit workers keep communities strong. They show up every day with commitment, creativity, and deep local knowledge, even as many face financial strain, burnout, and structural barriers that undermine their well-being.
“Worker well-being is community well-being. When our staff are taken care of, our community is taken care of.”
The well-being of nonprofit staff is a critical driver of the effectiveness, resilience, and long-term success of mission-driven organizations. To document the challenges and spotlight promising practices and opportunities for building nonprofit worker well-being, Nonprofit Finance Fund (NFF) created The Heart of the Sector, an in-depth research report and a shorter, practical guide for implementing new strategies, informed by interviews with nearly 50 nonprofit, foundation, and government leaders; analysis of over 70 data sources; and the responses of 500 California nonprofits from NFF’s 2025 State of the Nonprofit Sector Survey. This research was generously supported by the Walter & Elise Haas Fund and The James Irvine Foundation.
With these resources, nonprofit and philanthropic leaders can better understand sector dynamics, see what’s working for peer organizations, get inspired to implement new practices, and dive into the rich data sets to learn more.
How Funders Can Support Nonprofit Worker Well-being
This 11-page guide presents the promising practices nonprofits are implementing to improve worker well-being, and actions funders can take to support nonprofits in these efforts. With examples from exhaustive research and the lived experience of nonprofit and philanthropy executives, this report prepares nonprofit and philanthropic leaders to understand well-being approaches, counter challenging dynamics, and take action to expand worker well-being.
Advancing Nonprofit Worker Well-being in California
This 31-page report offers a detailed look at nonprofit worker well-being, exploring the factors that shape well-being, the state of well-being for California’s nonprofit workforce, promising practices from nonprofits and funders to support worker well-being, and recommendations for funders looking to begin or advance their approach. Plus, 38 pages of appendices present key data for informed decision-making from a variety of sources, as well as an overview of essential compensation reports and wage and poverty benchmarks.
Actionable insights for leadership, grantmaking, and more.
These resources share data and stories of nonprofits implementing bold practices to support worker well-being, including:
Equitable pay.
Filipino Advocates for Justice (FAJ)’s journey toward equitable pay started with the COVID-19 pandemic and the rise in anti-Asian violence. The organization was focused on supporting the wellness and mental health of their communities in light of these external stressors and traumas, which affected their clients as well as their organizers – all of whom were representative of FAJ’s constituents.
At the same time, the organization was in a strategic planning process through which they committed to focus on well-being for clients and staff, and recognized that there had to be “actual shifts in people’s material conditions.”
This kicked off 2.5 years of phased work for a compensation task force. Phases included: a regional scan to see where FAJ staff stood; board and staff participation in training to develop a values-driven, equitable compensation structure; and the task force’s creation of a transparent compensation structure based on salary bands. In 2022, all salaries went up 15.5% in order for the organization to raise its salary floor from $40,000 to $64,000. The organization has also enhanced its benefits to include a $1,200/year wellness stipend, flexible spending accounts, and a 401(k) program.
Board support was critical to FAJ’s success in making these changes. The board encouraged the executive director to include cost of living adjustments in budgeting, and would pass deficit budgets in some years so as not to sacrifice staff salaries in service of a balanced budget. Executive Director Geraldine Alcid says, “My biggest advice: Start anywhere. If it seems like it’s so much, focus on one or two things and just do it.”
New or enhanced benefits.
The Richmond Neighborhood Center (TRNC) has been on a journey to improve compensation and benefits since 2021, when the organization brought in a new chief financial officer and changed its budgeting practices.
Over the course of three years, TRNC has increased pay such that all workers earn a living wage. When the new CFO came on board, the organization was making the minimum contribution for employee health care costs as required by the City of San Francisco under the Health Care Security Ordinance. Their contribution cost was for a medical benefit card for employees, which was underutilized. The new CFO asked what might happen if they paid more on employee benefits, but people actually used them, and it benefited the organization. In tandem with this change, the organization set the threshold for benefits eligibility at 20 hours, and began to offer full medical, dental, and life insurance coverage. TRNC also makes an automatic 4% retirement saving contribution, regardless of what the employee contributes. Now, 60% of the staff use the benefits TRNC offers.
These investments have yielded clear operational returns. TRNC has experienced increased employee retention and reduced recruiting and onboarding costs, allowing it to maintain stable staffing levels. As a result, programs are launched on time, enrollment remains strong, and services are delivered as planned.
TRNC shared that its journey is not unique: these outcomes are achievable for any nonprofit willing to rethink its approach to financial management and align organizational values with financial decisions. By ensuring that commitments to principles like equity and community impact are reflected in budgets and by challenging outdated conventions that treat underinvestment in staff as fiscally responsible, TRNC says all organizations can adopt a more strategic, values-aligned approach to financial management. This ultimately strengthens workforce stability, improves programs, and better serves communities.
Flexible work schedules and locations.
Canal Alliance is a nonprofit organization serving the Latino immigrant population in Marin County. The organization has roughly 110 full- and part-time staff, and provides direct services in the areas of immigration, education, behavioral health, workforce development, education, community planning, and housing, and also engages in policy advocacy and civic engagement efforts to change systems that contribute to inequity for immigrants.
Canal Alliance implemented a four-day work week as the result of a strategic planning process through which worker well-being was prioritized. The four-day work week was identified as a tactic for decreasing turnover and improving overall worker well-being. The path toward a four-day work week started years prior to implementation though, involving building strong teams rooted in trust and streamlining processes.
The four-day work week pilot started in February 2024 and was made permanent after four months because of the demonstrable impact across the metrics Canal Alliance decided to track. During the pilot phase:
- 87% of staff reported improvement in their work-life balance.
- 78% of staff reported improved mental health.
- 73% of staff reported improved physical health.
And the positive outcomes from this transition have continued. From the beginning of the pilot to June 2025, Canal Alliance had:
- 0 resignations as a result of burnout.
- 70% increase in applications for open positions, and a 40% increase in qualified applicants.
- 50% reduction in staff turnover, which translated into more than 5,500 hours of staff time saved (or almost 3 full-time equivalent positions) that would otherwise have been spent interviewing, onboarding or covering for open positions.
While there was certainly a learning curve, the outcomes for the organization and its staff have been undeniably positive.
Collaborative leadership and decision-making.
Youth Organize! California, or YO! Cali, is a field-building, network-based organization with the goal of supporting youth in building power and achieving long-term change in their communities through organizing. While they have always had co-executive directors guiding the organization, two years ago the organization implemented a shared leadership model with two internal groups: the culture stewardship team and the resource leadership team. All staff must join one of the groups and everyone received a $5,000 raise to reflect their new leadership responsibilities.
Since launching, the resource team has trained staff on fiscal management, including procurement and how to estimate expenses and develop budgets. The team reviews budgets developed by program teams and then presents them to the co-executive directors for approval. The culture stewardship team oversees staff practices and organizational culture. For example, they revamped the staff evaluation process after seeing a big discrepancy in how team members were doing evaluations and the friction that this was creating internally. At times, the two teams work together to resolve issues related to allocating resources. Part of what has allowed YO! Cali to build a successful model is having clarity around what decisions are owned by each team and by the co-executive directors – “it’s a fine balance and requires being very clear about where people have agency and where they don’t.”
Staff unionization.
We spoke to several organizations that have unionized, each with a different impetus, including: a wish to preserve the culture and rights of a small organization as it merged with a larger organization; an effort to protect a certain category of worker that was at odds with leadership; and a call for more worker influence on organizational policy and workplace democracy. One organization noted that the impetus for unionization came from front-line and younger staff, and others observed that early unionization efforts in the nonprofit sector have been in organizations that work closely with organizers and unions.
We summarize here what they shared about the experience of unionizing and what it has meant for their organizations:
- Improved salaries/wages and increased visibility into pay increases.
- Consistent and improved policies around paid time off and benefits.
- Clarity on shared processes for policy changes and decision-making.
- Formalized and consistent supervision, staff evaluation, and leadership development pathways.
- Reduced burden on leadership for decision-making.
Of these, the reduced burden on leadership is the most surprising, as it goes against common characterizations of the relationship between union members and leadership as antagonistic and the assumption that unions add a layer of bureaucracy. On the contrary, one leader we spoke with talked about how the contract helps her:
“The burden of having to make all the decisions is now shared across the organization. Having a contract is so helpful – I can turn people to that and if they don’t like things, it can be addressed via the next bargaining period. It provides a very clear process.”
We also share best funder practices for improving nonprofit worker well-being, including:
- Starting the conversation around benefits.
- Prioritizing worker well-being in grantmaking strategy through:
- Full cost funding.
- Multiyear and unrestricted funding.
- One-time or additional grants.
- Funding well-being programming and initiatives, such as sabbatical and professional development programs.
- Supporting research into worker well-being.
- Creating spaces for learning, sharing, and advocacy.
Plus, discover low-lift ways funders can support worker well-being.
This report was made possible with generous support from the Walter & Elise Haas Fund and The James Irvine Foundation.
Eager to learn more? Check out our 2025 survey regional data for more information about the state of nonprofits in Los Angeles and the Bay Area, including data around worker well-being, funding dynamics, and nonprofit financial health.
See report coverage in Inside Philanthropy (subscription required).
