As a small-business owner, your first temptation when looking for help may be to tap into that ready-made employment pool of yours: the relatives.
But it may turn out that hiring family members is not as convenient a solution to your employee needs as you may think. In fact, bringing relatives into the business without considering the consequences could harm the health of both family relationships and your business.
All three of my brothers work for my husband. Fortunately, things have gone smoothly, but if conflict arose, it would be very difficult to deal with it in an unemotional way. You can fire a family member from the business, but certainly not from the family.
Most people who hire relatives don’t consider the wisdom of their action until after the fact, when a problem has already surfaced, according to Joyce and Robert Brockhaus of the St. Louis-based husband-wife family business consulting team, The Brockhaus Group. The time to decide whether to allow relatives into the company is before hiring any, the Brockhaus’ say. This calls for a thorough assessment of the benefits and drawbacks of mixing family with business.
Benefits may include a higher degree of trust. Whether it’s information you’re guarding, or cash, a family member is less likely to deceive you. Employees who are related may also be more loyal to the company than others.
Drawbacks include resentment among other employees, the perception of favoritism, the risk of family troubles infecting the business and vice versa. As the Brockhaus’ point out, a conflict among family members who work together can damage a lot more than the business.
If the decision is made to hire relatives, clear parameters should be set covering qualifications, hiring circumstances, pay and code of behavior.
One tactic the Brockhaus’ recommend is to require family members to work outside the business for three to five years. This allows the family member to gain experience (and make their mistakes) elsewhere; it builds their self-esteem and it shows them that all bosses can be difficult, not just Mom and Dad.
Next, the family has to decide on a pay scale for family members. The Brockhaus’ recommend paying family members the same as other employees. If they’re paid too much, they may feel locked into the position and other employees may become resentful. If they’re paid too little, they’re being penalized for their blood lines.
Clear rules of behavior should be set and applied equally to all employees. The Brockhaus’ know of one company that allowed a brother to stay on despite being caught stealing. For all other employees, that was a fireable offense. When word got out in the company, the other workers loss respect for the company owners.
The family firm can avoid potential misunderstandings and hard feelings by setting criteria governing all aspects of employee hiring and behavior before a single family member is brought on board. It’s also important to foster an atmosphere of honesty and openness. Often, children feel obliged to go into the family business even if the type of work holds no interest for them. For them, it may take the death of a parent before they can finally break free and do what they love. Parents and children can avoid this by keeping communication flowing.
Though it may be tricky to mix business and family, the rewards can be enormous. Working together allows relatives to see facets of each others hidden in most personal relationships.
“You see families and you just see how proud they are watching each other develop,” said Joyce Brockhaus.
