3 Reasons Why Hiring Friends and Family Is a Bad Idea

It’s tempting to hire a friend or family member when you have an opening in your business. You’d be helping them out and would get to work with someone you already know well, so it’s win-win, right? Well, not usually. Here are three not-so-great things that often happen when you employ friends or relatives.

Don’t get me wrong… hiring your friends and family to help get your small business going can be a good thing. Especially if they are really interested in helping you get it off the ground in the early going and are working for free or for a very reduced wage while you have little or nothing to pay out.

But we all know that can’t go on forever. Either your business fails because it’s not making enough money to pay the workers or the workers need to be paid more when it starts to show a profit. Either way, the situation has to change.

But in the long run, is it really a good thing to hire your friends and family to work for you? I’m going to give three reasons why I think it can turn out bad – from my own experiences and from the experiences of others I’ve been associated with. 

For me, my top three reasons are that they often…

Expect extra freedom.

When you hire friends and family they may sometimes expect professional and personal freedoms that they would not expect in normal employee-boss relationships. Time off, missed deadlines, coming in late, going home early, or even a higher level of authority and decision making than their position would normally allow are just a few of these potential expectations that come to mind. I’m not saying this always happens, of course, but it is more likely to happen. Be careful, it can be a downfall and can lead to sloppy follow-through within the organization. Watch out how your customers may perceive your ability to deliver.

RELATED: 5 No-Fail Hiring Tips for Small Businesses

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Give unwanted input.

You’re the boss. How you run your business is your business. Friends and family who are working for you may start offering unwanted advice and it can be hard to ignore and harder to shut off. Just because they are friends and family does not mean you have to listen to or heed their advice, but it can make it hard to quiet them without the fear of offending them. If they were just any employee, would you put up with it? No. So you may have “force” yourself to start treating them like any other employee and that is very hard. If you can’t, then you may need to end the working part of the relationship.

May not look at commitments as real.

Many times – at least as I’ve observed – family and friends may not look at agreements, commitments, and deadlines as absolute. They often look at them more as suggestions. The end result? It can end up costing you clients if you’ve trusted important work to them that they let fall through the cracks. Think of it as your teenager who leaves the lights on or isn’t as careful when he’s walking down the hall with a large suitcase hitting the wall. Why? Because he doesn’t own the house. He doesn’t pay the bills and in most cases isn’t made to participate in too much of the maintenance (except in my house they are). The house and associated expenses often don’t mean the same to that teenager that they mean to the homeowner parent. Employees – true employees outside the family and friends circle – see you as a management authority. No matter how hard you try to convince them otherwise, often friends and family still see you as a friend or family first, not management authority.

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It can be hard to work with those who are personally close to you. Especially if they helped you get the business off the ground or helped you out in a tight spot and now you’re seeing some detrimental behavior that is affecting your business. But if you want to keep your company alive and your customers calling, you may have to take a tough stance.

Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

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