Managing Employees Who are Also Friends or Family | Fora Financial Blog
How to Manage Employees Who are Also Friends or Family
August 24, 2017

How to Manage Employees Who are Also Friends or Family

Hiring a friend or family member to join your small business can be a blessing or a curse. Someone you know and trust outside of work could be a loyal, committed employee whose skills are strengthened by your prior relationship. Or you could find that they leverage your relationship to take extra allowances not available to other employees, like showing up late, slacking off on achieving goals or disregarding your authority and directions. Here are a few strategies to keep in mind when you are considering hiring a friend or family member.

The Hiring Process

Before you hire a friend or family member, consider why you are thinking of choosing them for the position. Do they have the skills, experience and talent to succeed in this role, or are you offering the position to them as a favor? Regardless of your personal connection, you should always follow hiring best practices when filling a position.

You shouldn’t hire anyone unless you feel they are the best person for the job and can bring valuable expertise to your small business. They should also have the potential to fit in well within your company culture and values. If this isn’t true, you may find yourself divided between relating to your family or friend and the environment you’ve created at work.

If possible, it’s best to remove yourself from the decision-making process. This will allow you to avoid suspicions of nepotism and the blame won’t fall solely on you if the person turns out to be a poor fit for the position.

Setting Expectations

This should begin in the hiring process and carry throughout the person’s time working at your business. Establishing clear boundaries can be especially important during the first few weeks as the new employee settles into their role and the dynamic of the workplace. This might include limiting discussions about your private life, or asking the person to call you by your first name rather than the nickname you’ve had since you were a kid.

The best way to set boundaries is to have an open conversation about how you envision your professional relationship. You should both plan to leave any personal issues at the door when you’re at work. The same is true for avoiding work issues outside of the office as other employees could feel they are missing out on important information.

Because the relationship you have with this person is likely based on a long-term history full of good times as well as conflict, it can be difficult to manage this person in a rational and objective way. Your own emotional intelligence could make or break this relationship, so it’s important to set clear guidelines for yourself and keep these in mind as you interact with this person.

Even if you’re confident in your strengths as a business owner and manager, you’ll be surprised at the effects of inviting someone from your personal life into the workplace. You might feel the need to provide too much or too little guidance, or you might resist offering feedback about poor performance. Plus, you may always wonder if your interactions with this employee seem like favoritism. If other employees begin to suspect this, it can lower the team’s morale and damage your reputation. This can even cause some of your best employees to leave the company if they feel their path forward is blocked.

You should provide regular feedback as you would with any employee, and if you feel your friend or family member has crossed the boundaries you’ve set, it’s important to let them know. Otherwise, you could both slide into bad habits that you may not notice later.

Recap of the Pros and Cons


  • A friend or family member could be a loyal and trustworthy employee.
  • You may have a better idea of what to expect from them, including their strengths and weaknesses.
  • Seeing a familiar face at work can be uplifting.
  • They may work harder than other employees.
  • They may already believe strongly in you and your vision.


  • They could take advantage of your personal relationship to break company rules.
  • They may turn out to be lazy and unmotivated at work.
  • Other employees may suspect favoritism.
  • Your friends and family may expect favoritism.
  • They could create divides within the company culture.
  • If they act unprofessionally, they could give your business a bad reputation.

There are a lot of factors to consider when hiring a friend or family member. By following the strategies above, you stand a good chance of crafting a successful working relationship, and you’ll know what to look for and how to respond if things begin to go awry.

Fora Financial

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

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Devin has managed several friends and siblings in business ventures with no regret.  He writes from his garage, meddling with his friends' cars in between sudden spouts of inspiration.
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