Negotiating Pastor Employment Agreements for California Churches

A pastor’s terms of employment are often spelled out in an employment agreement. For many churches the pastor’s employment agreement creates significant financial and legal obligations. Given their importance, such contracts should be negotiated with the help of an attorney who is retained to protect the interests of the church as an institution.

What goes into a typical pastor employment agreement?

The specific contents of a pastor’s employment agreement depend on a lot of things, from the size and resources of the church to the pastor’s personal expectations. Church doctrine and parent organization policies can have a significant influence on what goes into a contract. A typical employment agreement tends to cover things like these:

• How much the pastor will be paid.
• If offered separately, how much housing allowance the pastor will receive.
• What sort of insurance coverage the pastor will receive.
• Paid sick leave, parental leave, and similar matters.
• The pastor’s job obligations, which might include important functions of church governance, financial management duties, and so on.
• The pastor’s rights to receive severance or other benefits in the event the church ceases operations.
• A description of the circumstances under which the pastor may be fired for cause.
• Ownership of copyright and other intellectual property rights in the pastor’s work.

When negotiating an employment contract the issue of compensation likely will be a significant focus. This can be a complex question for churches that are located in areas with a high cost of living. Although church leaders will want to retain as much discretion as possible over future adjustments, the pastor may want some security with respect to rising rents or other issues.

The negotiation challenge

In the course of negotiating an employment agreement the pastor and the church often are temporarily on opposite sides. Negotiations can even get quite heated as fundamental disagreements about key terms get resolved. For church leaders, it is important to bear in mind that they represent the church as an institution, and they must be prepared to protect it against accepting terms that are not in the church’s best interest. This is where an attorney can be of significant value.

The Church Law Center of California counsels church managers on all aspects of governance. We are happy to answer your questions about negotiating employment agreements. Call us at (949) 892-1221 or reach out to us through our contact page.

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