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Pros and Cons of Hiring a Family Member or Friend
September 20, 2018
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Pros and Cons of Hiring a Family Member or Friend

Small business owners are often approached by family members and friends that are look for job opportunities. While it can be tempting to offer a position to someone you know, the decision should be carefully considered because it could affect your relationship.

To help you determine if hiring a family member or friend is right for your business, check out our list of the pros and cons of hiring a family member or friend.

Should Your Business Hire a Family Member or Friend?

The Pros of Hiring a Family Member or Friend

1. You’ll Know Their Strengths and Weaknesses

When you recruit employees through traditional hiring processes, you must uncover the candidate’s strengths and weaknesses in an interview. With a family member or friend, you probably know exactly what you’re getting. For instance, you’ll know ahead of time if they’re excessively chatty, a hard worker, or always running late. This can make it easier to know where they’ll fit within the company.

2. You’ll Have a Level of Trust

In a business relationship, you must be able to trust your employees. You can’t do all the work, and if you can’t trust your employees to do their jobs, your business will suffer. Since you already have a level of trust in your personal relationships, it can be easy to trust family members or friends to get their jobs done and communicate clearly. Additionally, HuffPost says you should hire people who share the same core values. By hiring a family member or friend, you’ll already know that they believe in your company values.

3. They’ll Be Invested in Your Business’s Success

A Gallup survey of 1.4 million employees revealed that organizations with a high level of engagement were 22 percent more productive than organizations with unengaged employees. As a business owner, you want your employees to care about the business’s success, so hiring your friends and family could be beneficial because they’ll be more likely to champion your business than people you don’t know.

The Cons of Hiring a Family Member or Friend

1. Managing a Friend Can Be Awkward

Outside of work, your friend or family member is your peer, but at the office, you’re their boss. If they’re not performing well and you need to reprimand them, it could be awkward. You must ask yourself if you can objectively give feedback in the workplace and discipline them the same way you would address issues with any other employee. It’s also harder to fire a friend than it is to fire any other employee and that may hurt your relationship with that person if you decide to let them go.

2. Your Existing Employees Could Perceive it as Nepotism

Before hiring a family member or friend, it’s important to carefully consider how it will affect your relationships with your current employees. Even if the family member or friend is qualified to do the job, some employees may see it as nepotism. Your employees are your greatest asset and it could be detrimental to your business if they’re unhappy.

3. Acknowledging Unmet Expectations Can Be Difficult

When you hire a family member or friend, you may have expectations about what it will be like to work with that person, but sometimes people are different in stressful work situations than they are in their personal life. Additionally, they may have expectations that they are going to get treated differently because they have a preexisting relationship with you. Inc magazine suggests that you should set expectations on day one to avoid any damages to your personal relationship. They also suggest creating a contract and defining the scope of the job clearly.

In Conclusion: Determine If Hiring a Loved One Will Affect Your Relationship or Business

If you decide to hire someone you know, be prepared that your relationship could change. While many businesses have had successful experiences, it’s hard to be friends with the boss. It has the potential to ruin your relationship if things don’t go well and you must understand the implications of that before extending the offer letter.

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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Fora Financial is a working capital provider to small business owners nationwide. In addition, the Fora Financial team provides educational information to the small business community through their blog, which covers topics such as business financing, marketing, technology, and much more. If you’d like to see a topic covered on the Fora Financial blog, or want to submit a guest post, please email us at [email protected].
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