3 Disadvantages of Hiring Friends and Family

When a small business owner has an opening in their business, they might find themselves tempted to consider hiring family members or friends. They’d be helping out that loved one, and they’d get the chance to work with someone they get along with. Sounds like a win-win, right?

Unfortunately, bringing personal relationships into a workplace often doesn’t work out well. This guide walks through three of the main disadvantages of hiring members of one’s personal circle in a business, plus some of the limited circumstances when it might work out okay.

3 Primary Drawbacks to Hiring Family Members or Friends

Family bonds and good friendships are great, but they don’t always mix well with business. Here are three drawbacks for business owners to watch out for.

1. Friends and family might expect extra freedom.

In an “ordinary” working relationship between a boss and an employee, there are pretty clear-cut boundaries and expectations. Usually, the employee knows (and abides by) the rules for time off, missed deadlines, coming in late, going home early, and showing respect in the workplace. But when family-owned businesses (or even solo business owners) hire loved ones, those boundaries tend to get a bit blurred. A family member might feel they have some leeway to leave thirty minutes early, take a longer lunch, or voice their opinions about how the company is being run in a way that no ordinary employee would ever consider doing.

Granted, this doesn’t always occur when hiring relatives or friends. But it does happen, even when the business owner tries to avoid giving anyone special treatment. And when it does, it can have a big (and negative) impact on company culture. It can breed discontent in other employees, compromise the company’s efficiency, and more.

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RELATED: Should a Business Owner Hire Their Family and Friends?

2. Friends and family may give unwanted input.

Good bosses respond well to constructive criticism from their employees (provided it’s delivered in a way that’s professional and not disruptive or deeply disrespectful). And good employees tend to provide that feedback in an appropriate way. Yes, disgruntled employees may mouth off, but the good ones usually adhere to the proper channels for giving their boss feedback or suggestions.

But what happens when a business owner hires their best friend or their cousin to work at their business? That loved one might feel they have the right to weigh in on business decisions more than the typical employee. And the business owner might feel obligated to listen to their opinions more than they would from their typical new hire.

If a business owner does decide to hire a family member or friend, they’ll have to take special care to set boundaries and give clear expectations on what’s acceptable when it comes to giving input about how the business runs. And if they aren’t comfortable setting those ground rules with their loved one, it might be best to make the difficult decision not to hire them.

3. Friends and family may not look at commitments as real.

Sometimes, hiring a family member might not be the right move because, as an employee, that person might not view their responsibilities as essential or their deadlines as absolute. They might think of their duties and due dates as suggestions, not requirements.

The end result can be disastrous. A business owner could lose clients if they entrusted a family member with an important account. Other team members could find themselves buried in extra work because they’re picking up that person’s slack. Even if a business owner has a long conversation with their loved one explaining that there needs to be a boundary between the workplace and life outside of it, and that they’re management while at work, that person might always let the personal relationship take precedence.

Getting a family member to consistently uphold their commitments isn’t impossible, but it can be incredibly tricky.

So should small business owners ever hire loved ones?

In theory, it is possible for a small business owner to hire a friend or family member and establish a successful working relationship. But it’s essential for the business owner to weigh that decision heavily, asking all the right questions. For starters, is that loved one truly the best person for the job? Or is there a better candidate out there? Even though it’s tempting to help a family member out, especially if they’re in a tough spot financially, a business owner will want to make smart hiring decisions since their own business finances are limited.

Another good consideration to make is if the friend or family member has a history of being a good employee. If they don’t do a good job at their existing job, odds are that performance won’t improve while working for a friend or family member. It’s also wise to consider if that person takes and gives criticism well, as most business owners need to be able to give and receive feedback from all their employees.

A business owner may also want to consider how they’ll feel about not giving their loved one special treatment in the workplace. For example, if a parent wants to hire their son, who’s a freshly minted college graduate, they can. But they probably need to assess whether they, as a boss, would be able to reprimand him for a poor interaction with a customer. And that’s just one potential scenario.

If a business owner ultimately decides to hire a family member or a friend, they should take proactive steps to establish clear boundaries and expectations for working at their organization. Doing so can help maintain the line between the working relationship and the personal one, helping everyone in the office work well together.

Key Takeaways

Small business owners can hire their friends and family members, but they may want to take some time to carefully consider whether it’s a good idea. These three drawbacks are especially common; too many businesses have hit rough waters because the owner hired a loved one and their personal relationship caused stress, interpersonal tensions, and even lost clients.