The good, the bad, and the ugly of hiring family members

Finding the right employees for your business is hard, and so is retaining them. When you need a hire on short notice or an extra pair of competent hands to help, turning to family members can seem like a great option. After all, what is family for if not to lean on?

While working with family members might seem like a good idea, it can often lead to challenging and uncomfortable situations or even potentially hurt relationships. Of course, there are always exceptions, and some family businesses rely on keeping employees and hiring processes within the family.

Before choosing to go one way or the other in terms of hiring family members, it's crucial to consider the pros and cons. Thinking critically about potential hire outcomes beforehand can help you forecast whether or not hiring family members--or friends--is the right move your business. Let's take a look at the ways a personal hire has room to go wrong or right.

1.       The Good

There are several obvious benefits to hiring a family member or close friend. Before they even start working, you probably already have a good idea of what their strengths are and how they can be used to the advantage of your business. An added bonus is that, given your personal relationship with them, you might not have to run a background check and can already determine the quality of their character. The high trust level makes for a pre-seasoned employee, which can be an excellent investment for business owners.

One really popular way many business owners use family members for employees is through informal hiring. In this kind of situation, employees are much more likely to work for lower rates. For example, if a restaurant owner has a nephew who wants to make some extra weekend money, he might bus tables for a small amount of cash. If another employee calls in sick and you're left short staffed, you can call on a family member to help you out for the day. Informal hiring like this, in which a service is exchanged for money under the table, is a common practice for many family businesses.

2.       The Bad

Hiring a family member or individual with whom you have a personal relationship does not come without a fair number of risks. First and foremost, in making a personal hire, you run the risk of nepotism. The trouble with nepotism is that you might not even think you're showing any such favoritism, but it's still being perceived by other employees. Perceived nepotism can be just as problematic as actual nepotism, and once the thought of employee preference is there, it can be challenging to get rid of.

There's also a chance that the friend or family member you choose to hire might take advantage of you. If they can't take you seriously as a boss, odds are they'll talk to other employees about you in a manner that undermines your authority and causes you to lose your image as the person in charge.

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