Newly created and smaller support institutions can normally not afford to employ their trainers, consultants or researchers on a fix basis. Mostly, trainers, consultants and researchers are independent contractors who get paid on accomplishment of a predefined job on a daily, hourly rate or lump sum basis. Generally, independent contractors are like entrepreneurs responsible to pay all taxes and social programmes out of their gross income.
Inevitably some full-time staff will need to be recruited to administer the institution and provide a "person" contact for inquiries and responses. The recruitment of staff incurs fixed costs for the institution, so the management board must be clear about how those costs are going to be covered by revenues at least six months into the future. Salary costs are a trade off between what the individual expects as reward for his or her work and what the institution can afford. There is, of course, a level below which it will be impossible to find someone with the appropriate qualifications and experience.
Many new institutions overcome these dilemmas at the outset by relying on voluntary "officers" who are repaid travelling expenses, or who draw a small representation allowance. Employing part-time post-graduate students and recent retirees can reinforce these efforts but then you have to consider the impact on your institution's long-term image and credibility.
Voluntary efforts cannot be sustained forever. In our experience two years is about the maximum duration for most community-minded individuals. Therefore, the initial business plan should show how sufficient revenues would be generated by at least year three to provide for one and a half or more full-time administrative assistants (see people plan chapter in the business plan).
a) Components of salary
The salary paid to these staff can be made up of several components - cash and in-kind. It is for the institution management team to determine what they can offer at least cost to the institution and at most value to the employee. For example: the employee may value highly the chance to obtain free or reduced course fees to obtain a diploma during his or her employment. Alternatively, your institution may be able to negotiate a discount on health and accident insurance, which would cost less than the value given to it by the recipient staff member.
b) The real cost of salaried staff
According to the employment legislation of your country you may have to pay a minimum salary level, social security, tax and social insurance contributions for your employees if they work more than a certain number of hours per week. You may also have to contribute to a pension scheme for them and provide them with a minimum number of paid holidays and sick leave entitlement. In some countries the income tax of salaried staff must be deducted at source and regular statements completed for tax and employment authorities.
This means that the actual cost of employing a salaried staff member full-time in your institution may be much more than the actual salary paid into their bank account. On average, staff rights and social costs add about 30% to the salary paid out. To this you must add the cost of the time taken to administer the obligations of employment. In addition, the contractual conditions of engagement and cessation of employment are usually covered by legislation and rights of appeal, contravention of which may lead to fines or withdrawal of your institution's status and operating licenses.
c) Salary scale planning
You will also need to plan regular pay increases to reflect the persons increased experience in the post and improved capabilities. If you employ more than one staff member you must create a salary hierarchy or scale and plan promotion paths and reviews. If you do not you will suffer from a high turnover of staff and spend much time training new recruits.
d) The outsourcing choice
To avoid this management burden some institutions choose to "outsource" their full-time administrative work to institutions that already have the required capabilities and experience. It can be much easier at the start to contract for six months administrative support than to spend time recruiting and training your own staff, buying equipment and finding premises. The disadvantage though is that your institution's individual personality may be lost in that of another and that the institutional memory build up over time by a conscientious administrative person will not exist. If you have to change administrative support providers it will be like starting from day one again. There are, of course, many varieties of outsourcing - including something called interim staffing, where temporary staff work in your premises on your equipment but are employed by an agency that takes care of legislative and other employment administration matters.