What Should We Pay Our Church Workers?

Questions about paying church workers are fairly frequently asked on the FIEC Advice Line. For example:

“What would be an appropriate salary for our new pastor/youth worker/administrator?”

“Does FIEC provide pay scales we can use?"

“Should we provide housing for our pastor?"

The simple answer to those questions is that we don’t answer such questions!

But that answer goes right to the heart of the Independent churches that FIEC serves: self-governing churches whose leaders must make decisions in the best interests of serving the gospel and the local church.

Each FIEC church will have convictions and circumstances that will rightly shape their practice. However, there are also laws which must inform our practices and principles which can help guide decisions on remuneration (i.e. the whole package of benefits offered) to church workers, whether they be a pastor, a women’s worker, an evangelist, or an administrator.

Office holder or employee?

Historically, many pastors in Independent churches have been considered officer holders rather than employees, and a number of our churches continue to operate in this way.

Being an office holder means a pastor does not have an employment contract (or employment rights) and can determine for themselves the hours and ways of working to fulfil their duties.

Recent legal cases suggest that unless a church can demonstrate it had no intention to enter into a contract and holds documented theological convictions preventing the pastor being an employee, pastors are likely to be regarded as employees as well as, or rather than, office holders.

You can read a fuller explanation of that and how a church can seek to clearly set out their position that a pastor should be an office holder in this article from our friends at Edward Connor Solicitors: Is your pastor an employee, office-holder or both?

Pastors who are office holders do not receive a salary but rather a ‘stipend’ for their duties. Arguably, churches have a greater moral responsibility towards office holders (who lack the protections of employment law, such as national minimum wage, statutory sick pay, or statutory paternity leave) and many will choose to reflect this in the stipend paid. Certainly, the lack ofan employment contract should not be used as justification for inferior treatment.

Many churches, however - both those with a single pastor and those with larger staff teams - operate an employer/employee relationship with their workers (with employment contracts and policies), paying a salary for the role, often with salary differentials to reflect the nature of different roles.

To house or not to house?

One of the biggest costs for anyone is housing. At the time of writing this, the average house price in England is nearing £300,000 and the average monthly rent is £1,375 (and significantly higher in some areas of the country).

So finding affordable housing in the right area, close to where the church meets, can be a challenge for many church workers. This is particularly true for younger adults who are not already established on the property ladder; even with a modest deposit, getting a mortgage for property at the national average price can require a household income of approaching £60,000 per year.

Different churches will take different approaches when thinking about housing for their workers. These approaches are not right or wrong, but rather context-dependent. They might include:

• Providing a manse
  A church-owned property provided for a church worker to live in as part of their remuneration package, with appropriate agreement on who covers utility and maintenance costs.
• A shared ownership arrangement
  The church and the worker contribute to the purchase of a property and take a proportionate share.
• Salary
  Considering the cost of appropriate housing in the locality and ensuring affordability within the salary offered.

The approach a church takes to housing a particular worker may also influence the rest of the remuneration package offered.

Cost of living

Alongside increasing costs of housing, much has been written in the press in recent years about the increasing costs of basic necessities such as food and utilities. This has put significant pressure on household incomes across the country.

The current Government has committed to continued increases in minimum wage levels, keeping pace with the increases in median earnings. This will see an increase to £12.21 per hour for those over 21 from April 2025 or an annual full-time salary of just over £25,000. The Living Wage Foundation argues that the “real living wage”, based on the cost of goods and services, is £12.60 per hour, or a full-time equivalent of just over £26,000.

All church employees are, as a minimum, legally entitled to be paid the National Minimum Wage for the hours that they work, whether that be full-time or part-time and regardless of the role that they are in.

Whilst those who are office holders have no legal right to be paid the national minimum wage, they are, of course, subject to the same costs of living, and a reflection of this in the remuneration offered is appropriate.

Comparative salaries

A useful tool for setting remuneration packages for employees could be considering salaries paid to others in comparable roles (in other churches or the wider workforce) or considering the average earnings of the congregation in the church.

Perhaps most commonly for pastors, churches have turned to the teachers’ pay scale. A newly qualified teacher in England would expect to be paid £31,650p.a., rising to £45,000p.a. with 5 years’ experience and to £50-60,000 for a headteacher of a small school (in 2024-25).

Nationally established pay scales also exist for youth and community workers and administrative staff in the local authority sector, which may provide helpful benchmarks for those in such roles. Last published in 2023, the UK Church Administrators Network produce a benchmarking survey which provides helpful data, particularly in the area of remuneration for operational and administrative staff.

Some churches look to other churches’ structures, whether through local contacts or nationally published denominational pay scales. Particularly in this area, caution is needed to ensure that the full package of remuneration is understood including around office holding/employment status and the provision of housing.

Other obligations

Pensions

The Pensions Act 2008 requires every employer in the UK to put certain staff into a workplace pension scheme and pay into it, alongside the employee. The Pensions Regulator provides helpful information on employers’ duties in this regard. Those who are office holders have no automatic pension rights and are not subject to the auto-enrolment provisions of the Pensions Act.

Regardless of legal obligation, making appropriate provision for church workers for when they come to retire from paid work is an important way of honouring those who serve in this way. This includes both pension provision and consideration around housing for those who have been provided with housing during their service.

Tax and National Insurance

Whether church workers are office holders or employees, PAYE applies and tax and national insurance will be paid. This should be managed through your payroll system or by your payroll provider. Your pastor may also be required to complete a self-assessment tax return.

The majority of employers will be eligible for Employment Allowance, reducing their liability for Employers National Insurance contributions by up to £10,500 per year. Further details on eligibility and how to claim can be found on the Government website.

Expenses and benefits

Employees or office holders may incur expenses such as travel costs and supplies purchased for their role, which they are entitled to reclaim from the church. A clear policy covering what can be claimed and process for doing so is an important part of caring well for those who work for the church.

So, what is the right salary for your church workers?

The answer is, of course, for each church to consider for themselves.

But let me urge you to be thoughtful, caring, generous and prayerful as you work through how to honour church workers through your remuneration of them.