Membership Fees Policy
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NC-CFOB-Financial_Policy_Questions_Politique_Financière-GD
Archived Policy
Last revision: February 28, 2005
This document last modified: May 20, 2011
Please note that this policy will apply to both Service Canada and Human Resources & Social Development (HRSD) hereinafter referred to as the "Department" or "Departmental".
Table of Contents:
- Policy Objective
- Policy Statements
2.1 General - Additional Policy Requirements
3.1 Memberships will NOT be paid for - Procedures and Processes
4.1 General
4.2 Professional association membership fees relating to an employee's collective agreement - Responsibilities
5.1 Additional managerial responsibilities - Guidelines
6.1 Values and Ethics
6.2 Departmental vs. Individual Membership
6.3 Membership in association with a federal statutory requirement
6.4 Professional association membership fees relating to an employee’s collective agreement - Monitoring
7.1 Reporting and Public Accountability - References
8.1 Treasury Board of Canada, Secretariat publications
8.2 Other - Certifications
9.1 Duty to accomodate
- Appendix A: Delegation of Authorities
Appendix B: Definitions
Appendix C: Frequently Asked Questions and Best Practices
Appendix D: Additional Information Concerning the Membership Strategy
1. Policy Objective
The objective of this policy is to summarize the issues surrounding the expenditure of public funds by the department on "memberships".
This policy reflects some important principles of modern management by emphasizing responsible spending and careful stewardship in the use of public funds to meet government and departmental objectives.
2. Policy Statements
2.1 General
2.1.1 This policy reinforces the department's commitment to adhere to the Treasury Board policy on Membership Fees.
2.1.2 It is Treasury Board and therefore departmental policy to pay membership fees only when: 1) departmental membership in an organization is in direct support of a departmental program; or 2) when individual membership is a federal statutory requirement for an employee to carry out his or her duties; or 3) in a few limited instances, when it is a specific requirement in an employee's Collective Agreement for the employer to pay the amounts specified in the agreement.
2.1.3 Approval of a membership must be in accordance with the departmental delegation of authority. Such approval must be in writing to substantiate the payment. (i.e. Verbal approval is not sufficient.) As well, sufficient documentation should be retained on file for audit purposes.
2.1.4 Membership fees in excess of $2,000 must be supported by a Membership Strategy. See Appendix D for further information concerning this requirement.
2.1.5 Every membership shall be reviewed annually prior to renewal to ensure that both the purpose and the need for the membership is still valid.
2.1.6 Renewals of membership fees originally approved by the Minister or DM may be delegated to the next lower level provided the conditions of the original approval remain the same. Such renewals, however, must be preceded by a review which evaluates the actual use made of the prior year's membership, that the expected benefit was received, and that it delivered the expected value.
2.1.7 If there is a change in the Minister or DM who approved the original membership the foregoing provision does NOT apply to the renewal. In this case the personal approval of the new Minister or DM would be required as if it was a new membership.
3. Additional Policy Requirements
3.1 Memberships will NOT be paid for:
3.1.1 The maintenance of professional, quasi-professional or other qualifications as these are the responsibility of the individual employee;
3.1.2 To organizations that are primarily social, recreational, or fraternal, unless recommended by the Deputy Minister or Deputy Head of Service Canada and authorized by the Minister;
3.1.3 To associations to which employees must belong to become eligible for appointment to a position.
4. Procedures and Processes
(May be modified to meet local requirements)
4.1 General
4.2 Expenses which may be incidental to a membership, such as attending a conference or a seminar, meals, etc. are outside this policy. These expenses come under the provisions of the Travel Directive, Hospitality or Conference policy, etc. (as applicable).
4.2 Professional association membership fees relating to an employee's collective agreement
4.2.1 Staff Relations and Compensation, People and Culture Branch are responsible for reimbursing professional association membership fees which are a compensation entitlement under an employee's collective agreement.
4.2.2 The reimbursement request is to be given to the employee's Compensation Advisor who will process the payment.
4.2.3 Reimbursement cheques will be issued by the PWGSC Regional Pay System, following the input of a pay action request by an HR Compensation Advisor. PWGSC Compensation Sector policies and procedures relating to this reimbursement process may be found in PWGSC Compensation Directive 2002-029.
4.2.4 As no specific claim form exists for this purpose, employees may submit their reimbursement request using the form FIN 2865B - Requisition for Payment.
4.2.5 Employees must provide the Compensation Advisor with "proof of payment" to the professional association. This may be the receipt issued by the accounting association for income tax purposes, or other proof of payment to the association.
4.2.6 Human Resources will make only one reimbursement per year, per employee.
5. Responsibilities
5.1 Additional managerial responsibilities
Traditionally, managers are responsible and accountable for all expenditures of public funds against their budget. Additional accountabilities apply in the case of membership fees because of: i) the limitations in the Treasury Board policy on Membership Fees; and ii) the existence of a specific departmental delegation of authority for membership fees.
6. Guidelines
6.1 Values and Ethics
Managers and employees need to be aware of two particular values and ethics issues relating to membership fees.
6.1.1 The first involves memberships in the name of individual employees. It must be kept in mind that while the policy allows for reimbursements to individual in certain circumstances, memberships are not to be viewed as being part of an employees compensation package. The payment or reimbursement of such fees should not be used to confer a benefit on a particular employee (except as provided for in their collective agreement).
6.1.2 Some organizations which the department deals with are funded by corporate/ sustaining membership fees. In some cases these membership fees may be $10,000 or more. When considering such a membership it is important to establish that membership in the organization is a requirement towards meeting departmental program objectives. It is not sufficient to determine that the objectives of the organization are consistent with or they align with departmental program objectives. Rather, it must be established that membership in the organization is one of the delivery mechanisms for meeting the program objectives of the branch funding the membership. Further, memberships over $2,000 must be substantiated by a membership strategy which explains the rationale for the membership. (For further information see section 2.1.4. and Appendix D.)
6.2 Departmental vs. Individual Membership
6.2.1 Individual memberships may be purchased when:
- The membership constitutes a licence that can only be issued to a person.
- The membership is only available to a person and not to an organization.
6.2.2 Memberships which must be obtained in the name of an employee are not to be regarded as a right of the employee, and publications and other benefits resulting from the membership accrue to the department.
6.2.3 Where specialized information or publications related to departmental programs are available through membership in an association or institute, the membership shall be in the name of the department.
6.3 Membership in association with a federal statutory requirement
6.3.1 Professional association fees may be reimbursed when membership in the association is a federal statutory requirement for the individual employee to carry out the functions of their position. Reimbursement of these fees is not considered a taxable benefit under the federal Income Tax Act. However, reimbursement of these fees may be considered a taxable benefit for Quebec residents under the Quebec Income Tax Act. More information is available from Revenue Quebec.
6.4 Professional association membership fees relating to an employee’s collective agreement
6.4.1 The Department will reimburse professional association membership fees in accordance with the terms of an employee’s collective agreement or Memorandum of Settlement. A number of collective agreements provide for the reimbursement of an employee’s membership or registration fees.
6.4.2 Collective agreements can be found at: http://www.tbs-sct.gc.ca/pubs_pol/hrpubs/coll_agre/siglist-eng.asp
6.4.3 Memberships and registration fees shall not be paid or reimbursed in regard to association to which employees may belong in order to become eligible for appointment to a position.
Employees must provide the Compensation Advisor with proof of payment to the professional association. This may be the receipt issued by the association for income tax purposes, or other proof of payment.
7. Monitoring
7.1 Reporting and Public Accountability
7.1.1 A record of membership and registration fees must be maintained by FAS Business Services.
7.1.2 Records of the total amount spent on all memberships and the number and type of memberships must be kept on a fiscal-year basis for evaluation or audit purposes.
8. References
8.1 Treasury Board of Canada, Secretariat publications
IMPORTANT NOTE: The purpose of this policy is to supplement Treasury Board policy, therefore it must be read in combination with the Treasury Board Membership Fees policy.
8.2 Other
The Delegation Authorities Manual places certain limits on the authority of RC managers to approve membership expenditures. Therefore it must be read in combination with this policy.
9. Certifications
9.1 Duty to accommodate
This policy is compliant with the TB Policy on the Duty to Accommodate Persons with Disabilities in the Federal Public Service.
Appendix A: Delegation of Authorities
The payment of membership fees is subject to the same approval requirements applicable to other Operations and Maintenance expenditures (O&M). It should also be understood, however, that Treasury Board has imposed additional limits concerning membership fees. These limitations are reflected in the Membership delegation of authority.
Appendix B: Definitions
"Memberships" in this policy includes all types of memberships, registration and licensing fees.
Appendix C: Frequently Asked Questions and Best Practices
Q. Will the Department pay or reimburse my membership fees to an association to which I belong? The membership permits me to keep up with the latest research and information relating to my work.
A. The Treasury Board and the departmental Memberships Fees policy pay membership fees according to section 2.1.2: "1) Departmental membership in an organization is in direct support of a departmental program; 2) when individual membership is a federal statutory requirement for an employee to carry out his or her duties; or 3) in a few limited instances, when it is a specific requirement in an employee's collective agreement for the employer to pay the amounts specified in the agreement."
In addition, section 3.1 states that memberships are not paid for the maintenance of professional, quasi-professional or other qualifications as these are the responsibility of the individual employee.
Employees are encouraged to check the Service Canada library for the availability of the association's publications.
Q. Can I reimburse an employee his membership costs to the Toastmaster Club?
A. While Toastmaster International requires that participants pay a membership, members are taught communication and public speaking skills.
This training/professional development would be reimbursed under the policy for the reimbursement of tuition. Employees seeking training in public speaking should identify their learning needs in their personal learning plan.
Q. An employee has requested to be reimbursed the costs of a membership that will permit him to participate at the annual forum at a reduced rate; can this membership be paid considering that there will be a cost saving for the government when the employee attends the developmental forum?
A. The provisions of the TB and departmental policy are very clear on which memberships may be paid. Financial savings through reduced rates for events is not a consideration for paying a membership.
Q. Who approves a membership that is covered by a collective agreement?
A. A Director/Director General can approve a membership that is covered by a collective agreement; the approved invoice/receipt is then sent to Human Resources Compensation for payment or reimbursement.
Q. Can an employee be reimbursed for membership in a social club that may be of value to his or her office?
A. It is highly unlikely that memberships of this type will be reimbursed. Such reimbursements would require the approval of the Minister.
Q. Do membership fees paid or reimbursed by the Department have to be reported as income by the employee for income tax purposes?
A. If there is a requirement for the employee to maintain a membership in the professional organization and the Department reimburses the employee for such a membership, the Canada Revenue Agency does not require the amount to be reported on a federal T4 supplemental slip. As well, employees cannot claim such membership fees as deductions for income tax purposes.
These amounts may be taxable for Quebec residents. Revenu Québec should be contacted for further information in this regard.
Q. My learning plan, which was developed in conjunction with my manager, proposes that I improve my oral and communication skills. My manager and I have agreed that participation in Toastmasters International would be an ideal vehicle to achieve this objective. However, to participate in Toastmasters I must become a member of that organization and pay a modest annual membership fee. Can the department pay this membership fee?
A. On the one hand, the TB Membership Fees policy states "Personal development, the attainment of career benefits and keeping up-to-date on developments in job-related fields is the responsibility of employees. Consequently, whether or not ancillary benefits accrue to the department concerned, payment of individual memberships for these types of reasons shall not be authorized by the employer."
However, the TB has determined that in a case like this, where the employee's personal training plan indicates the employee needs to improve their oral communication skills, and Toastmasters has been identified as the "training" vehicle, the Department may pay the membership because it is really a training expense.
Q. Can a manager approve a membership in the local Chamber of Commerce or Board of Trade when the membership is in the name of the Department?
A. According to the Membership "Delegation of Authority" only the regional executive heads, and above, has the authority to approve a membership in organizations such as Chambers of Commerce and Boards of Trade. The fact that the membership is in the name of the Department does not change this requirement. Both the membership policy and the delegation of authority assume that such memberships will be in the name of the Department
Appendix D: Additional Information Concerning the Membership Strategy
Membership fees in excess of $2,000 per year to one organization must be supported by a membership strategy. This strategy must demonstrate that membership in the organization directly supports the objectives of the program involved (i.e. that it meets the program objectives and that Parliament, Treasury Board and the department have allocated funds for this purpose). Further, it must explain the actual tangible benefits to the Crown and whether the membership fee provides good value for money to the department.
Membership fees over $10,000 per year to one organization must be supported by a more in-depth rationale. The rationale should include information on the decision-making approach which guided and led to the recommendation to the DM to support this membership. In other words, it should explain why membership in this organization forms part of the department's strategy for delivering the program.
This requirement is particularly important when the membership fees vary from member to member (i.e. the fee is not a universal rate), or where the benefits are unequal among all members. In this case the strategy must also address the linkage between the benefits received and the membership rates.
Other value-for-money considerations which should be addressed in the strategy in respect to assessing the appropriateness of the membership in the organization includes:
- Whether the department holds a position on the board of directors or similar governing body of the recipient organization, particularly if the department is a sustaining member.
- Whether membership offers a strategic advantage to the department.
- The capacity of the recipient organization to contribute to departmental program goals.
- The department's capacity to utilize the benefits of the membership.