Q: I have long worked for a global organization that is now impacted by President Donald Trump’s executive orders. Most employees here in the U.S. are being let go. I am being deprived of benefits to which I believe I am entitled. When I indicated that a lawyer could bring a lawsuit, their response was, “We are an international non-governmental entity, immune from claims.” What is that all about?
B.T., Los Angeles
A: A non-governmental organization is a group that, as the name implies, operates independently of governmental control. The usual purpose of an NGO is to promote a policy or provide services. Most NGOs are also nonprofits (or claim to be). Funding can be from various sources, such as government grants, private donations and membership dues. Some of these organizations have budgets in the millions, even billions, of dollars. Two examples are Greenpeace and Amnesty International.
In 1945, the United States Congress passed the International Organizations Immunities Act, which, among other things, grants international organizations the “same immunity from suit … as is enjoyed by foreign governments.” At that time, foreign governments were entitled to virtually absolute immunity as a matter of international grace and comity.
The issue as to whether an NGO is fully immune from suit was ruled on by the United States Supreme Court in the 2019 case of JAM vs International Finance Corporation. The court acknowledged there are immunities that shield qualified NGOs from claims, but also made clear that this protection does not apply to commercial activities. The focus then is what is meant by commercial activities? One example would be providing a loan, similar to a private loan and thus engaging in a basic financial transaction.
Thus, questions to ask include what activities are carried out by the organization? Also, do you have a written contract? If so, check to see if there are any terms or conditions that might be applicable. And, bottom line, if at all feasible, promptly consult with a knowledgeable attorney.
Q: Second question: Does my company, this international non-governmental entity, have any reporting requirements?
B.T., Los Angeles
A: An international NGO typically does have reporting requirements, given that it receives money from donors, and often receives grants from governments. Those who help support these organizations invariably want to keep tabs on what is spent, what it is spent on and how much is on hand. Thus, a regular financial and narrative report is to be provided, which sufficiently details the organization’s activities, and hopefully describes progress of any specific projects. This kind of disclosure should assure a level of transparency so that those involved in funding, let alone other interested parties, can seek to evaluate if the NGO is above board.
What I am not able to determine, as this column is submitted, is if you can find out what the salaries and benefits are of those who are running the organization. I will simply say it is not unusual that an NGO is based in Geneva, Switzerland. You have to assess for yourself if “monies in Swiss bank accounts” gives you any pause.
Ron Sokol has been a practicing attorney for more than 40 years, and has also served many times as a judge pro tem, mediator, and arbitrator. It is important to keep in mind that this column presents a summary of the law, and is not to be treated or considered legal advice, let alone a substitute for actual consultation with a qualified professional.