Should I Hire a Family Member?

Should I Hire a Family Member?

A reader sends this question:

“A relative keeps pestering me for a job in my business. He’s my nephew, but he is inexperienced and not even remotely qualified for the one opening we currently have. That opening is a key role and we need a great person in it. Should I give in and hire this family member anyway?” – Martin S. from Texas

Thanks for the great question, Martin. The short answer is no. Do not hire a family member in this situation.

Never put your business in possible jeopardy by hiring someone who is unqualified for a key job.

Look, many small businesses do in fact hire relatives with good success. A lot of small businesses are family businesses. There are over 5.5 million family businesses in the United States alone. So hiring a family member is fairly common and can be a good thing in a small business.

But not in this situation. In a situation like yours, where you know the person lacks the requisite skills and you have no room for error because you have limited openings, you have to stand firm.

3 Important Reasons Not to Hire a Family Member

Here are three really good reasons why hiring a relative in this situation would be a terrible mistake:

1. You Must Put your Business First!

Do you remember what flight attendants say to do if the oxygen masks drop down in a plane?

“Put on your own mask first before assisting other passengers.”

There is a good reason for that. If you pass out from lack of oxygen you won’t be able to help anyone.

The same principle applies to your business. No matter how much you are tempted to hire a family member in order to be a nice guy, your first obligation is to your business and its continued viability.

Think about all of those who are depending on the business:

  • Customers: Hiring an unqualified person does nothing to help customers. In fact, the wrong person actually can drive customers away.
  • Existing employees: Co-workers have to work harder to make up for a weak player, leading to low morale. Ultimately, giving in to a moment of weakness to hire a family member can put their jobs at risk if the company doesn’t thrive.
  • Your spouse and minor children: Your immediate dependents are relying on you. Do well by them first and foremost by making your business financially secure.
  • Yourself: Business owners are used to putting others first. But think about your quality of life — you need solid bench strength so you don’t have to carry everything on your shoulders. Think about your long term financial security, too, especially if you are nearing retirement age. You have worked hard and owe it to yourself to experience rewards. You’ll have more options with a successful business and strong team.

Many small businesses operate on a slim financial edge. One bad hire in a key role can mean the difference between success and failure. It helps no one if the business goes under or has to scale back due to missed sales forecasts. Don’t risk it.

2. The Ramifications Could be Serious if Things don’t Work Out

Think ahead. What if the relative is such a disaster in the job that you have no choice but to fire him later? If you think the decision to hire is tough, the decision to fire will be ten times worse.

Firing a relative could drive an irrevocable wedge between family members. Your relative and others close to him may end up resenting you due to the termination. Families have torn themselves apart for less.

If the family member happens to be someone with a sense of entitlement who is not self-aware, you can predict the result. People like that tend to react poorly when told they are not performing well.

3. You may not be Able to Train that Relative into the Job

Don’t count on being able to train an unqualified relative into growing into the job. That takes time and you may not have that luxury. Most small businesses need new hires who hit the ground running — right away.

Let’s take an example. If you employ 5 people in your business, and one is not up to the task, that’s 20% of your workforce being a drag on performance! If it takes a year to train and develop that one employee, can you afford a year’s lower productivity?

And what if he never steps up to the requirements? Can you afford a 20% ball and chain dragging your business down forever?

Your relation simply may not be cut out for this role. He may not have sufficient specialized education. The role may not play to his strengths or be within this nature. Employees are not interchangeable, after all.

And it’s not fair to hire a family member into a role he’s not ready for. You’re setting him up to fail.

Your nephew may not even like the job. Consider how you’d feel if you brought him on, spent a lot of effort training him, and then later he leaves. Meanwhile, all this time your business has been limping along on five cylinders instead of six. Yet, now you have to start all over. You haven’t done your business any favors.

How to Decline to Hire a Family Member – Gracefully

When turning down a relative for a job, sit down with him and talk with him face to face. Use the following techniques to let him down gently but firmly:

1. Explain Job Requirements

Clearly explain the job requirements and your expectations. Provide a written job description. Go down the list explaining the skills you are looking for. Ask him if he has all the qualifications. It’s a fair question. You deserve a fair answer.

2. Point Out Training Limitations

Younger workers and millennials often expect to be trained. If your company is not in a position to do a lengthy training, explain that without apology. Unlike large corporations that have lengthy year-long training programs, very few small businesses do.

3. Highlight the Critical Nature

Make a point to discuss how critical the position is to the company. Give examples of things that could go wrong and what that would mean. It may change his interest level to discover it will be a high pressure situation, with lots of responsibility riding on him.

4. Discuss Future Positions

Offer to consider him for a more suitable opening later on. Or consider him for seasonal help or special projects, if those apply.

5. Give Career Advice

Another thing you can do is give him career advice for job hunting elsewhere. Ask him about his ideal job and what he’d like to do. His career goal may have nothing to do with the position in your company. Get him thinking about the career he really wants. Offer to be a reference if you feel comfortable. Give him a few resume tips. Who knows, you might be able to facilitate an introduction with one of your contacts.

Last words: one of the hardest things in a small business is to not hire a family member. The pressure to do something for family is huge. Don’t give in. In the end his feelings may be hurt despite your best intentions, yet that’s not something you can control.

However, you can feel confident you made the right decision for the business and for everyone depending on you. Good luck!

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All answers to reader questions come from the Small Business Trends Editorial Board, with more than 50 years of combined business experience. If you would like to submit a question, please submit it here.

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This article, "Should I Hire a Family Member?" was first published on Small Business Trends



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