When it comes to hiring, you want to hire people that you can trust. Especially in the beginning stages, small business will hire friends and family members to work for them. Though, hiring family members can prove to be problematic, with the right structure in place, it can also be an asset. When considering turning a family relationship into an employment relationship, a lot of consideration must be taken.
What are the Concerns of Nepotism?
Let’s start off by talking about all the reasons that you do not want to hire a family member:
- Hiring family members can create issues of perceived inequity among employees who are not part of the family. They might feel that the family member is given preferential treatment, an easier workload or promotions based solely on relation rather than merit. This can create an environment where employees become disgruntled.
- The family member may feel that they do not need to follow the rules and that they are entitled to preferential treatment.
- They may also feel entitled to voice their opinion or get involved with issues outside of their area of expertise.
- Other employees are unlikely to raise concerns about a family member who is incompetent or making mistakes.
- Family dynamics or personal conflicts between family members can spill over to the workplace and vice versa. A family feud at the family dinner table on Sunday night can create unnecessary tensions in the office the next morning. Similarly, terminating a family member can create an uncomfortable Thanksgiving.
- Members of the same household may want to take vacation and days off together, thereby putting great strain on the resources who remain because of a smaller team.
Best Practices for Hiring Family Members
Here’s some ways to mitigate potential issues when hiring family members:
- Avoid perceived inequity: Ensure that all policies are applied equally to the family member. For instance, their working hours, vacation and compensation should be treated the same as other employees. Ensure that family members are subject to the same recruitment process as any other employee would have participated in (keep reading below for tips on recruiting family members).
- Manage Rule Breakers: Be clear about your expectations for the family member’s performance. Be prepared to have tough conversations for those who go outside the lines.
- Provide managerial support: If there is an issue with a family member interfering with issues outside of their expertise, ensure their Manager is clear that they have the support of the business to manage the family member’s performance and interactions the same way they would manage anyone else’s. Ensure the manager is equipped to handle the concerns and possible pushback of a family member.
- Provide support for other employee concerns: In order to ensure an open door for all employees to bring forward moral, ethical or any other concerns with another co-worker, ensure there are clear reporting lines and those family members never directly supervise other family members. In larger businesses, a non-owner family member should not be in a position where they have power over another family member or has influence over an immediate family member’s compensation.
- Mitigate family conflict interference: Ensure that family members do not work within the same department. Ensure your code of conduct policy is up to date and reflects how to deal with negative interactions amongst all team members.
- Be upfront about the possibility of resource drain during vacation times: When hiring, discuss that this could be an issue. Explain that extended vacations won’t be approved because of the drain on resources. During busy vacation request times, consideration will be given to each employee’s time off request as an individual and not as a joint request.
Recruiting Family Members
If you decide to allow family members to be hired, then it is imperative that they are hired through a fair and equitable recruitment process. They need to submit a resume, go through the screening process, interviews, reference/background checks, and offer letter the same as all of the other candidates. Additionally, the family member who is already employed by the company should not be a part of the recruitment process, and should not participate in the interviews, deliberation, and selection process. Family members should be selected because they are the best applicant for the position, not just because they are related to someone who already works in the company.
Offer Letters for Family Members
If you decide to hire a family member, make sure that you provide them with an offer letter just as you would provide any other new employee that you are hiring. The offer letter should outline all the terms and conditions of employment. Having this document agreed upon and signed by both parties can help protect you from future discrepancies with the family member as you have clearly defined the compensation that they are entitled to, the job that they are filling and their working conditions.
HR Support for your Family Run Business
Do you need some HR help for your family-run business? We can be an objective third party to help you manage employee relationships and establish company policies. Get in touch with us today.