The ins and outs of working with relatives
What is nepotism?
Many small businesses tout themselves as “family-owned.” This description can often be synonymous with nepotism, or the act of hiring close friends and family members, and can have a negative connotation. However, there can be many benefits to hiring family in the workplace if you do it correctly.
How hiring family members can improve your business
One of the best things about hiring relatives is that you already have a relationship with them and likely know them much better than those you would otherwise hire. To build a team that works, you need a variety of different skills, backgrounds and personalities. Due to your relationship with that particular family member or friend, you’ll already know how they fit in with the rest of the team and can quickly integrate them into your daily routine.
Hiring family in the workplace also means you’re bringing on those who could continue your legacy after you retire or decide to leave the business. Many family members will have more of a vested interest in your business’ success than other employees, especially if they plan to run it one day. This can lead to more dedication and an ownership mentality, which can set a good example for the rest of your team.
When hiring family members backfires
If you don’t treat your family members like the rest of the team, allow them to come in late or leave early, or promote them ahead of more qualified employees, your actions could cause a toxic organizational culture and ultimately hurt your business. Your other employees could start to wonder if you really value them, and your retention of key team members could suffer.
You also run the risk of hurting your relationship outside the business if your relatives’ employment does not go as planned and you need to discipline or fire them. That’s why it’s vital to talk to them before they are even hired and explain that your personal relationship is independent of your working status. Having trouble getting through to them on this issue? It might be a sign they wouldn’t make a good hire and that you should focus on them as a friend or family member rather than an employee.
How to hire a family member
Still believe hiring a family member makes sense? While you can’t control how your other employees view nepotism, you can build a process around the way you hire family members to increase your chances of success. It will probably look quite similar to the way you screen non-related candidates as it’s based around ensuring they’re the right team fit.
1. Ask the right questions
Do your relative’s passions align with your company’s mission? Will the position they fill leverage their skills and interests? Are they truly the best fit for the role you’re hiring for, or do you owe them a favor? Have them take the DISC profile assessment to better understand what drives and ultimately fulfills them. The discussion should be a two-way street, with both of you striving to figure out if this is a decision that will benefit everyone involved.
2. Gauge their personality fit
Personality is key when bringing someone into your business – whether it involves hiring relatives or not. Your close knowledge of your family member puts you at an instant advantage. While there must be a reasonable level of technical skill, it’s the soft skills – interpersonal skills, communication styles, thought processes and emotional intelligence – that can really make or break your hiring decisions. Hiring family members whose behavior and values oppose yours and those of your company will, over time, erode your brand and destroy morale.
3. Examine core values
Core values are what a company stands for and they’re derived from your brand’s ultimate purpose. They are your company’s creed and culture and what every employee – including those you are related to – should embody. Before hiring family in the workplace, clarify your core values and make sure your relative knows what will be expected of them. The smaller your organization, the more important it is to define how these core values should be manifested in that particular position.
4. Legal concerns
While hiring family members is not illegal and nothing explicitly prohibits you from doing it, there are some issues you should keep in mind. Declaring job openings and ignoring qualified candidates in favor of a family member may be crossing a line. Bear in mind that when hiring a relative, you are also required to disclose any potential conflict of interest to shareholders. Failure to make that information known could violate the 2002 Sarbanes-Oxley Act and result in fines or other repercussions.
5. Make the right choice
If you do end up hiring a relative, you must hold them accountable and ensure that the standards and expectations you set are not just met, but exceeded. A high-performing family member who is held to the same standards as the rest of the employees will gradually be accepted as a valued coworker, not just the relative of the boss who was hired due to nepotism. This, in turn, can raise standards throughout the company and lead to organic growth.
Running a business is a complicated endeavor and hiring family members to work with you can make it even more so. Though there are plenty of pitfalls that can occur when you work with family, there are just as many upsides when it’s done right.
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