DIRECTOR COMPENSATION
and VOLUNTEER PROTECTIONS

Many protections are lost if a director becomes a paid, professional director. To maintain their protections, directors cannot receive compensation for their service on the board.

Volunteer means the rendering of services without compensation.

Compensation means remuneration whether by way of salary, fee, or other consideration for services rendered. Most CC&Rs and Bylaws prohibit the compensation of directors.

Expenses Allowed. Reimbursement of expenses is allowed. Payment of per diem, mileage, or other reimbursement expenses to a director or executive officer does not affect that person's status as a volunteer. Corp. Code §7231.5(b), CCP §425.15(d), Civil Code §1365.7(b)

Volunteers Protected. By statute, volunteer officers and directors are protected against personal liability for mistakes they make while carrying out their duties. 

. . . no cause of action for monetary damages shall arise against any person serving without compensation as a director or officer of a nonprofit corporation Corp. Code §5047.5(b)

. . . there is no monetary liability on the part of, and no cause of action for damages shall arise against, any volunteer director or volunteer executive officer of a nonprofit corporation . . . Corp. Code §7231.5(a)

A volunteer officer or volunteer director of an association . . . shall not be personally liable . . .    Corp. Code §7231.5(a)

Updated 8/21/2007