When Churches Violate Their Own Bylaws

Written by Founder Raul Rivera on Jul 01, 2010 in IRS Compliance

On any given day, within the 50 states, thousands of churches are in court because of disputes between members and leaders.  These disputes usually begin with personality differences, but often times end up with both parties having to look at the details of the church's bylaws.  Such was the case with a church in Ohio whose pastor chose to change the time of the church's annual business meeting.  When some disgruntled members disagreed with his decision and noticed it was inconsistent with their bylaws, they sued the pastor.  The court, in keeping with the church's bylaws, invalidated the meeting because the pastor did not follow the procedures stated therein.  Do you know what's in YOUR bylaws?

What's in my bylaws?

Have you read your bylaws lately?  Do you know what they say?  You must know what is in those bylaws so that you do not find yourself having to back track many of the decisions you have made.  In the Church Compliance and Ministry Empowerment Conferences that I have conducted all across America, one of the most recurring comments I hear is "We are not doing most of the stuff that is in our bylaws."  That is a real serious problem that continues to get bigger every year.  It's no wonder why more churches than ever in our history find themselves in court today.  Let me share with you 5 common ways pastors and leaders violate their bylaws.

Five ways you may be violating your bylaws

  1. Spending Limits:  Your bylaws may state that checks for any amount exceeding $1,000.00 require two signatures, but you as the pastor have been signing checks that are for a larger amount without ever fully realizing that the financial limit clause exists.  Be sure to check out whether or not your bylaws contain such a clause! 
  2. Annual Audit: Many church bylaws require that an annual audit of the books be conducted every year, but very few churches actually do it.  There are different types of audits that can be done in your church books.  For churches with over 1200 members, I recommend the professional approach of hiring this out.  However, generally for churches under 1200 members, I do not recommend that it be a professional audit performed by an accounting firm using certified public accountants (simply for cost's sake).  Take the approach that a sufficient number of people have looked at the books and can give reasonable assurance that good stewardship and accountability exists and that the financial records are accurate.  The treasurer can do this with a church member that has business and financial skills.
  3. Removing a Member: When a church member publicly or privately and without repentance lives a lifestyle that is contrary to Scripture, the time may come for the church to have that member removed.  The procedure used must be exactly as described in the bylaws.  Did you know that the largest source of church disputes concerns such matters and the provisions of the bylaws regarding how this is handled? Never assume that a church member living in unrepentant sin will go down quietly.  You may not even have a procedure for removal, which means you may not even be allowed to remove a member once he/she has been added to membership.  If that provision is missing, you need to amend the bylaws.
  4. Annual Minutes: The laws of all fifty states require that an incorporated church conduct an annual board meeting with real minutes taken recording the discussion and decisions of that board meeting.  Do your bylaws call for an annual meeting?  If not, you need to amend them to have that clause added.  If so, have you been conducting one and do you have adequate minutes to reflect the meeting?  If not, then it is time for change.  This is really big.  First of all, the states require it.  Not doing it can invalidate the members of the board including the pastor/president.  Why? Because the minutes should record every time a member of the board of directors elected to serve.  We recommend no more than a two-year period between reelections.  Secondly, to keep your tax exempt status the IRS requires an annual board meeting with accurate minutes.  Finally, what does it say of our stewardship when we cannot keep an accurate record of the decisions we make as leaders of the church?
    Are your minutes a mess?  Let us help you.  Call us at 770-638-3444 and ask for one of our church plant specialists.  We will get you back in shape again.  

But they seem so trivial

A dangerous posture that many pastors take is to believe that the matters of church bylaws are trivial.  One pastor may say, "I don't worry about trivial matters . . . it's God's sheepfold and HE is the One who takes care of me."  That is true, He does take care of all of us.  He will also take care of us whether we are in church or in court having to defend our ministries.  With a little bit of effort today, you can avoid trouble down the road later.  Do not walk alone.

Please feel free to comment. We always appreciate good dialogue. However, we do moderate each comment to ensure that it is on topic and not derogatory to other participants. We ask that you keep your comments brief and pertinent to the topic so that others may benefit.

Raul Rivera

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