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Employing family and friends has always been an issue in small business. Over the years, I have seen family and friends working OK in businesses, but on the whole, there are generally constant issues.

Business owners employ family and friends because it is quick and easy to do. They know the person so expect they can work with them without any problems. Then the issues start to arrive, familiarity means the business owner finds it harder to discipline them when they are not happy with their work. They generally let issues slide because they don’t want to confront their friend or family member, whilst, in the mean time the issues grow and so does the resentment.

One rule of employing people is that they must be better than you at carrying out the role they are employed for. When you just go and employ a friend or family member it is generally done without comparing them with other applicants, so you don’t have the opportunity to see if they are the best available in the market place.

From observation over the years, another benefit of employing family and friends is that they are generally paid a lower rate. But that’s where the old saying “Pay peanuts, get monkeys” comes from.

There are a few rules you should follow when considering employing family or friends in your business.

  1. If a position needs to be filled, advertise the role.
  2. If you have a family member or friend that you could employ, interview them along with other applicants. If they come out best in the interview, then they could be employed.
  3. Do not employ a family member or friend if you have not compared them against other applicants.
  4. Provide clear guidelines on the employer/friend relationship. i.e. Work stays at work, social life stays with social life.
  5. If there is a problem with their work, deal with it immediately. Don’t wait.
  6. If their position needs to be terminated, terminate it. Don’t procrastinate.

Over the years, I have noticed businesses that rarely, if not at all, employ family and friends are significantly more successful than businesses that regularly employ family and friends.

Have a great weekend,

Peter