ROC Members Have Rights to Employees' Salary Information

Posted on December 18, 2009 by Scott Gordon

Can unit owners in resident-owned communities discover what the association is paying its employees, including the manager? 

We are asked this question frequently each year, especially when the association is in the process of preparing its annual budget.   Obviously, the association's employees would prefer that information about the compensation they are receiving be kept private and confidential and many board members and managers are uncomfortable disclosing this information to residents in the community.  Directors are concerned--quite often, with justification--that the residents in the community do not understand that a salary paid to a ROC employee in Ohio twenty years ago would not be a competitive salary in a community in Florida in 2009.

However, Florida's statutes governing condominium associations, cooperative associations, and mandatory homeowners associations make it clear that information about the compensation paid to an employee and the other benefits that an employee receives falls within the "official records" of the association.   Any association member is entitled to inspect and copy this information.

I have a few suggestions to help board members and managers maintain some amount of privacy for the association's employees without violating Florida statutes:

  1. Florida's statutes require that an association member's request to inspect or copy official members be made in writing and that the association has a number of days to respond to that request.  This allows a manager confronted at the office by a unit owner demanding salary information to request that the unit owner submit his request in writing prior to allowing that unit owner access to that information.
  2. The requirement that requests to inspect official records be submitted in writing allows the President or Chairperson to advise any member insisting upon disclosure of an employee's salary during a meeting of the board or membership that any unit owner  wishing to obtain this information is free to do so by submitting a written request as provided for by Florida's statutes.
  3. It's also very helpful if the association's board of directors can assure its members that its employees' wages, salaries, and benefits are in line with those paid to employees in comparable communities in the area.  The board or manager can often obtain this information from its accountant or through networking with neighboring communities.   Local chapters of the Community Associations Institute and regional groups such as Mid-Florida ROC or SWFLROC  would provide an association's board members the opportunity to gather this information on an informal basis.

Finally, any member that does inspect or copy information about an employee's compensation and benefits should be gently but firmly reminded that any employee of the association deserves the courtesy of not having his or her salary broadcast throughout the community indiscriminately.   No unit owner would enjoy having his financial information freely discussed at the pool or in the clubhouse and any member that obtains an employee's salary information channels should respect that employee's privacy. 

In addition, ROC members living in communities where not all of the residents are members of the association (such as resident owned mobile home cooperatives where some home owners are not members of the cooperative) should keep in mind that a unit owner who divulges an employee's salary may in fact be providing that information to non-member homeowners who are not entitled to that information and who may try to use that information to damage the  association--for example, by challenging an increase in the annual rent to be paid by the non-member mobile home owners and citing the salary information that was intentionally or unintentionally disclosed to that non-member.

Clearly, every member of the association owes both the association's employees and all of the other residents in the community a high degree of discretion when that member obtains information about the compensation and benefits paid to association employees.

 

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Several Recent Articles of Interest to ROC members

Posted on December 14, 2009 by Scott Gordon

Last Sunday's edition of the Sarasota Herald Tribune featured two separate front page articles that highlight the decisions that helped lead us into our current economic mess and threaten to keep our economy from recovering in the near future.

  • The first article focuses on a condominium project in Charlotte that finds most of its units "occupied" by "phantom purchasers" from Brazil who have not paid their maintenance fees and have left the few purchasers that actually live in the development facing substantial monthly expenses for the upkeep of the common areas.  While this is a lengthy report, I highly recommend it to members of resident owned communities.
  • The other article detailed the failure and refusal of many of our major financial institutions to make loans to small businesses and homeowners in spite of the clear message sent to these institutions by our President and Congress.   In its own way, this article is as depressing and maddening as the first.

I'd also like to recommend L. Jon Wertheim's story in the most recent issue of Sports Illustrated.  It's entitled "The Games of Their Lives" and it describes the efforts of two athletes to fulfill a final dream--to compete in the Beijing Paralympics.   This bittersweet but uplifting depiction of the triumph of the human spirit and the tremendous support given to these two champions (in many cases, by total strangers) gave me a very helpful dose of perspective during this time of the year.

As many of you know, we've just completed our first set of seminars for the 2009-2010 season.   Thanks to the over 200 residents from almost 55 different communities throughout the state for attending and to our hosts at Molokai in Leesburg, Old Bridge Village in N. Fort Myers, Sandalwood Park in Venice, and Westwinds Village in Bradenton for their great hospitality.   We'll be posting the dates and locations for our next set of seminars within the next few weeks.   We hope to see you at one of those events!

 

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Condominium and Cooperative ROC Members Should Understand the Difference Between Ballots and Proxies

Posted on December 7, 2009 by Scott Gordon

We are now well into our "season" in Florida and most resident owned communities will be holding their annual meetings during the next few months.  It's thus a very good time to remind my blog readers that are members of condominium or cooperative associations of some of the important differences between ballots and proxies:

  • In general, neither general proxies nor limited proxies can be used to elect the directors of a condominium or cooperative association.   The applicable provisions of the Florida Statutes that deal with the election of directors of condominium associations (F.S. Section 718.112(2)(d)) and cooperative associations (F.S. Section 719.106(1)(d)) specify that the members of the board of directors shall be elected by "written ballot or voting machine".   While the majority of voting interests in a condominium association with ten or fewer units or a cooperative association can provide in their association's bylaws for a different voting procedure that allows for elections to be conducted by limited or general proxy, I suspect that the bylaws governing most ROCs do not allow for this alternative procedure.
  • F.S. Sections 718.112(2)(b) and 719.106(1)(b) provide that, unless the association's bylaws provide for a different percentage, the percentage of voting interests required to constitute a meeting of the members shall be a majority of the voting interests (in other words, 50 percent plus one) and that, unless otherwise provided in the association's governing documents or the applicable Chapter of the Florida Statutes (either 718 or 719), "decisions shall be made by owners of a majority of the voting interests represented at a meeting at which a quorum is present".    While limited proxies or general proxies can be used to establish a quorum as provided in Sections 718.112(2)(b) and 719.106(1)(b), ballots cannot be used for this purpose.   In other words, in order for a member to be counted as "present" in establishing a quorum at the annual meeting (or other membership meeting), that member must either be present in person at the meeting or have delivered his properly executed general or limited proxy to his proxy holder or the association prior to the meeting.
  • Neither general proxies nor ballots can be used for votes to waive or reduce the statutory reserves otherwise required by statute or to waive the financial reporting requirements of F.S. Section 718.111(13) (for condominium associations) or F.S. Section 719.104(4)(b).  The only way a unit owner can validly vote on these matters is either by limited proxy or in person at the meeting where the voting occurs.
  • The election of directors occurs at the annual meeting even If a quorum cannot be established at that meeting if at least twenty percent of the eligible voters have cast a ballot in that election, as provided in F.S. 718.112(2)(d)3 and F.S. 719.106(1)(d)1.

The provisions governing timeshares and mandatory homeowners associations are somewhat different and members of timeshare communities and subdivisions should consult with their association's attorney for additional information.

 

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