S T A T E O F N E W Y O R K
2013-2014 Regular Sessions
I N S E N A T E
May 16, 2013
Introduced by Sen. MARCELLINO -- read twice and ordered printed, and
when printed to be committed to the Committee on Corporations, Author-
ities and Commissions -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the not-for-profit corporation law, in relation to
prohibiting certain employees of a not-for-profit corporation from
serving on the corporation's governing board or from hiring family
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 602 of the not-for-profit corporation law is
amended by adding four new paragraphs (g), (h), (i) and (j) to read as
(G) THE BY-LAWS OF A NOT-FOR-PROFIT CORPORATION SHALL CONTAIN A
(1) EMPLOYEES SERVING ON SUCH GOVERNING BODY AND THE PERCENTAGE OF THE
MEMBERSHIP OF THE GOVERNING BODY THAT MUST BE INDEPENDENT OF THE ORGAN-
(2) HIRING OF FAMILY MEMBERS OF EMPLOYEES AND GOVERNING BODY MEMBERS;
(3) CONFLICT OF INTEREST COVERING BUSINESS INTERESTS.
(H) ALL BY-LAWS REQUIRED IN THIS SECTION SHALL BE AVAILABLE FOR REVIEW
BY THE ATTORNEY GENERAL UPON REQUEST.
(I) EMPLOYEES OF A NOT-FOR-PROFIT CORPORATION ARE PROHIBITED FROM
SERVING AS THE CHAIR OF SUCH ORGANIZATION'S GOVERNING BODY AND FROM
SERVING AS A VOTING MEMBER OF SUCH ORGANIZATION'S GOVERNING BODY.
(J) NO PERSON WHO IS RELATED TO THE CHIEF EXECUTIVE OR ANY MEMBER OF A
GOVERNING BODY BY BLOOD OR MARRIAGE SHALL BE EMPLOYED BY SUCH ORGANIZA-
TION, EXCEPT WITH THE APPROVAL OF TWO-THIRDS OF THE MEMBERS OF THE
S 2. This act shall take effect one year after it shall have become a
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.