7 Critical Steps to Protect Your Church from Legal Risks

In today’s culture, legal threats to churches are on the rise. Churches increasingly face challenges like:

• Zoning restrictions

• Attacks on tax-exempt status

• Property disputes

According to ChurchLaw&Tax.com, the Top 5 Reasons Churches End Up in Court include:

1. Property Disputes

2. Sexual Abuse of Minors

3. Personal Injuries

4. Insurance Coverage Disputes

5. Zoning Issues

To reduce legal risks, churches must adopt proactive strategies. Here are 7 ways to protect your church:

1. Leverage the Law in Your Favor

Partner with legal professionals who understand church law to ensure you’re using the law to your advantage in areas like zoning, property rights, and tax exemptions.

2. Strengthen Your Governing Documents

Your church’s bylaws and constitution are vital. Conduct an annual review to ensure these documents:

• Reflect current ministry practices

• Address leadership structure

• Outline conflict resolution strategies

3. Minimize Liability with Effective Policies

Create clear policies in these 3 key areas:

• Child Protection Policy – Ensures child safety and protects volunteers

• Financial Accountability Policy – Establishes transparency and prevents fraud

• Facility Use Policy – Defines who may use church property and under what conditions

4. Develop Effective Employment Practices

Establish clear hiring, termination, and employment procedures to protect both your church and your employees.

Key Practices for Employment Protection:

Clarify At-Will Employment:

• All employment documents (offer letters, policy manuals, salary updates) should clearly state that employment is at-will.

• Avoid language that unintentionally creates contractual obligations.

Define Religious Employer Rights:

• Clearly state in your employee manual that employment decisions are based on adherence to the church’s statement of faith and moral teachings.

• Require all employees to acknowledge this policy.

Identify Ministerial Roles

• The Hosanna-Tabor v. EEOC ruling allows churches to make hiring or termination decisions about ministers without government interference.

• Clearly describe spiritual duties in job descriptions for roles like pastors, worship leaders, or teachers to strengthen protection.

Use Separation Agreements When Needed
Since churches are typically exempt from unemployment insurance, consider offering severance packages that provide:

• Financial support for the employee

• A lawsuit release

• Non-compete and non-disparagement clauses

• Clear communication about the reason for separation

5. Maintain Insurance Specific to Your Needs

Ensure your church carries insurance that covers:

• Employment-related claims

• Liability for volunteers

• Property damage and theft

6. Clarify Property Issues Early

Churches often face disputes over:

• Land ownership

• Leasing agreements

• Zoning restrictions

Addressing these issues early through proper documentation helps protect your church.

7. Protect Your Children, Students, and Volunteers

Create and implement a comprehensive child protection policy that includes:

• Background checks for staff and volunteers

• Clear incident reporting procedures

• Annual training on abuse prevention

Final Thoughts

To safeguard your church from legal risks:

• Use at-will employment language in all job-related documents

• Emphasize your church’s role as a religious employer

• Implement separation agreements when appropriate

• Regularly review your bylaws, policies, and insurance coverage

Need Help Protecting Your Church?

For expert legal guidance, contact Reynolds Law Group, PLLC. Our team can help you create clear employment practices, draft protective policies, and reduce legal risks for your church.