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Church Integrity and Compliance with the Law

  • Michael Martin Dir. of Member Services and Assoc. Legal Counsel, ECFA
  • 2013 6 Jun
  • COMMENTS
Church Integrity and Compliance with the Law

Complying with the law is a fundamental principle for churches desiring to model integrity. Demonstrating integrity is important for churches because, over time, doing so establishes and reinforces necessary trust with church members as well as those outside the church who we are called to reach with the Gospel. Enhanced trust ultimately translates to a greater witness and Kingdom impact.

When churches and their leaders fail to respect and comply with the laws set in place by the governing authorities, the results can be devastating. Nearly all churches that fail to comply with federal, state or local laws probably do so unintentionally. Nonetheless, the implications are significant.

What happens when people hear of pastors serving prison time for breaking tax laws or churches sued for not establishing appropriate policies to guard against the possibility of abuse? Instances like these drown out the good news of the Gospel for unbelievers. Even longtime Christians may struggle in their faith after seeing their churches or leaders fall.

But in today’s complex and ever-changing legal environment, it is virtually impossible for a church to ensure 100 percent compliance with all laws at all times. ECFA's standards in this area strike a helpful balance, requiring accredited churches to “exercise the appropriate management and controls necessary to provide reasonable assurance that all of the organization’s operations are carried out and resources are used in a responsible manner and in conformity with applicable laws and regulations, such conformity taking into account biblical mandates.”

So, while it is not likely to guarantee compliance with every possible law and regulation, an important aspect of demonstrating your church’s integrity is instituting the best controls and procedures possible to comply with laws that apply to your church.

What are some of these potential legal issues for churches to consider? Compliance responsibilities range from tax, to property, to employment, and even to criminal law, to name just a few. Noted church law expert Richard Hammar recently provided Brotherhood Mutual with the following list of top 10 legal issues facing churches today: 

  • negligent selection of youth workers
  • registered sex offenders
  • same-sex marriages
  • the duty to warn
  • child abuse reporting
  • church security
  • church computer policies
  • employment liability: the ministerial exception
  • discrimination based on morals or religion
  • automatic excess benefit transactions.

Churches can begin demonstrating integrity in this area by having their leadership – church staff and those serving on the governing body – educate themselves with legal compliance resources provided by church law experts like Richard Hammar (www.ChurchLawandTax.com) and organizations like ECFA (www.ECFA.org).  

After becoming aware of potential areas of liability, the next step is seeking counsel from attorneys who are experienced working with churches in these areas to implement compliance measures. Finally, it is advisable to continually evaluate compliance as your church grows or shifts ministry focus over the years.

These steps are more than just good policy for churches – they are biblical! The Bible is clear about the importance of submitting to those in governing authority and complying with the law.

I Peter 2:13 (NIV) says, “Submit yourselves for the Lord’s sake to every human authority....” The preceding verse teaches that if we demonstrate integrity in how we live, even those who accuse us of wrongdoing will see our good deeds and glorify God. The Scripture goes on to say that submitting to authority is proper not just “to those who are good and considerate” but also to the unjust.

Why is this? The Bible teaches that when we as believers make every effort to be excellent in our conduct and demonstrate integrity – including compliance with the laws of all governing authorities – it  sends a strong witness and brings glory to God.

Romans chapter 13 is another passage that highlights the importance of obeying the governing authorities. It explains that all authorities have been established by God for our good, and disobeying these authorities is a form of rebellion against God Himself.

If we do what is right, the Bible promises we will be commended for demonstrating integrity. The corollary, of course, is that we will face discipline if we fail to operate in accordance with the laws set by human authorities.

In conclusion, respecting and obeying the law is not just good practice for churches, it is biblically-mandated. There are many consequences for failing to demonstrate integrity in complying with the law, but the most important consequence goes right to the heart of the church’s calling:  Our very ability to carry out the Great Commission suffers if we do not take appropriate steps to ensure compliance with the law.

Michael Martin is director of member services and associate legal counsel with ECFA (Evangelical Council for Financial Accountability), an accreditation organization that sets standards for governance, financial management, and fundraising/stewardship for churches and other nonprofits across the country.

Publication date: June 24, 2013