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5 Things to Remember When Hiring Friends and Family

As my fellow entrepreneurs know, our goal—from the day we make the decision to get into business onwards—is to expand. Furthermore, the logical extension of business expansion is hiring employees to help with day-to-day tasks. But, as I learned personally, the time spent deciding whether or not to bring in freelance assistance, temporarily disregarding the idea of full-scale employees, is one that is usually filled by requests from friends and family members to help (for compensation!) with business.

From the start, I knew perfectly well that these courteous friends and family members were trustworthy and skillful. However, compensation (including hourly pay and the ever-intimidating annual salary, in addition to benefits) and shifting from personal to professional relationships were somewhat unfamiliar elements of the process, for me. Eventually, though, I was able to overcome these hurdles and many others, and today, most of these same friends and family members still work for my company.

To save my fellow entrepreneurs the hassle and heartache I grappled with to get to this point, here’re some helpful hints for hiring friends and family members.

1. Don’t think “free”—think “value”

Nobody in the world wants to work for free—not my family members, not your family members, and not anyone’s family members, for that matter. This knowledge hit me like a ton of bricks, and put a prompt end to my “free-work fantasy.” The only person that helped me for anything less than solid compensation was my sister, who was completing an internship for her school.

However, everyone’s definition of “stellar” compensation varies, and to be sure, some friends and family members expected awesome pay right off the bat, while others barely wanted anything more than the opportunity to add to their resume. Be sure to discuss compensation expectations before hiring anyone, so as to avoid future misunderstandings.

2. Relationships come first, business comes second

To say that my business is important to me would be an understatement, and similarly, I know that your company means the world to you as well. With that said, let me provide you with the solution to an inevitable hurdle pertaining to family employees that caused me substantial trouble: family and friends come before the business, and that should be clear from the outset.

Set workplace discussion limits (no talking business outside the office!), let employees know that they should come to you with any problems or misunderstandings, and don’t ever, ever, lose your temper. If you rub your employed family members or friends the wrong way, you’ll jeopardize your life outside the office (not to mention that things will be immediately less efficient in the office), and these problems will ultimately spill over into your office life.

Trust me.

3. Don’t compromise on toughness

While it’s imperative that numerous work limits and freedoms be established for friend/family employees, it must also be emphasized that toughness is key. If I wasn’t occasionally tough, my workplace would have become a socializing facility—plain and simple. Thus, while I didn’t want to be rude, I had to sometimes make clear that it was my livelihood on the line—not theirs. Moreover, I had to set hard deadlines, detail my expectations, and let individuals know when I didn’t feel as though they were carrying their weight.

You will too, and it’s best to know that right off the bat.


4. Make all actions equal

Eventually, you’ll have to contend with the issue of “equal treatment,” between friend/family employees and outside hires. Playing favorites (or appearing as though you’re playing favorites) is problematic for a variety of reasons, as I’m sure you know.

To avoid these pitfalls, I’ve established clear-cut performance reviews, crafted carefully detailed workplace expectations, actively allowed employees to approach me with workplace concerns, and most notably of all, held each worker to the same rigorous standards.

Make all your actions equal—I did so, and I can honestly say it was the best thing to do for myself, my employees, and my company.

5. Explore the benefits you’re entitled to

I’ll admit that even I haven’t fully completed this step. But I will do so sometime soon, and you should as well. Entrepreneurs who hire family members are entitled to a variety of benefits, including tax deductions, health insurance price adjustments, and increased Social Security earnings. Meeting with an employee-benefit lawyer will help you to rack these benefits up ASAP.

Wage exemptions can also be secured for spouses and children under the age of 18. Unfortunately for me, my daughter isn’t even five years old, so it’ll be quite a while before she can lend a (free) hand around the office!

Hopefully the provided information and knowledge will prove useful to you. Thanks for reading, and here’s to entrepreneurial success!

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5 Things to Remember When Hiring Friends and Family

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