Whether you think of favouritism towards friends or relatives as nepotism really depends on which side of the employment fence you’re on. If you’re an employer, particularly in a smaller business, there can be some distinct advantages to bringing friends and family into your business.
Advantages of hiring family
For one thing, you don’t have to go through a costly and time-consuming recruitment process. You presumably already know something about the person; what their main strengths and weaknesses are, whether they’re reliable and trustworthy, whether their values will fit with the company culture and so on.
You also know that if it’s a family member they will have a vested interest in seeing the business do well and will therefore be more committed in terms of going above and beyond when necessary and possibly accepting a lower wage.
And if you have built up your business with the express intention of handing it on to your children, then bringing them in and allowing them to put their own personal stamp on things would be the obvious thing to do. Of course you are showing favouritism, but that is because you are building a family legacy.
But is it nepotism?
The definition of nepotism is ‘showing favouritism to friends and relatives, regardless of merit’ and the last three words are the key.
In the interests of your business, you should always be looking to appoint the best person for the job. Does your friend or relative have the qualifications and experience the role demands?
If the answer is ‘no’, then you could well be guilty of nepotism. It’s not a crime and it happens all the time, but the problems you could be creating for yourself by hiring such a person may come to outweigh the benefits over time.
The downside of favouritism
They say you should never work with children or animals and in some circumstances, ‘relatives’ should also be added to the list.
If you live with someone and work all day with them as well, there is the potential for your relationship to become strained. If you have a disagreement at work, that disagreement follows you home to the dinner table. If you disagree at home, it follows you into the office.
With no clear separation between work and personal life, your relationship and your business could suffer as a consequence.
If it’s not an immediate family member, but a close friend that you always get on well with, there are still no guarantees this will be the same in a working relationship.
Suddenly you are their ‘boss’ and they may not respond well to this change. They may resent it, leading to conflict, or they may try to take advantage of it. Either way, your business suffers.
Employing friends or relatives can also create difficulties for you personally. Because of your ‘outside’ relationship, discussions regarding salary and performance issues can be awkward and you may feel your hands are tied in certain areas, which is not a great way to be running a business.
The other main downside to hiring friends and family is the effect this can have on your other employees. If the person you hire or promote is not qualified for the job, they are immediately going to be seen by others as receiving preferential treatment.
This will not only affect their ability to perform the role, because they will be regarded with suspicion and even hostility, but it will also affect your standing as an employer.
If you are seen to be rewarding on the basis of relationships rather than merit, then your employees will begin to trust you less and have less respect for you as an employer.
This can result in a loss of overall productivity, as hard work is no longer seen as the way to get ahead, and loss of loyalty, which can translate into high staff turnover, as disgruntled employees look for better opportunities elsewhere.
So what’s the solution?
There are some great benefits to having friends and family in your business and indeed, if you’re a small concern, it can be vital to have them involved. But to avoid any problems, you need to hark back to the first rule of business, which is to hire the best person for the job.
If there is an existing staff member who is better qualified than your relative, then give the job to the existing staff member. It will be good for staff morale and will benefit your business.
Above all, make the selection process as transparent as possible. If your relative actually is qualified to do the job, make sure everyone knows it, otherwise it will be perceived as nepotism, whether it is or not.
When dealing with family and friends in the workplace, spell out to them at the beginning what your expectations are and where the boundaries lie. The secret is to treat them just as you would any other employee.
In the past, some business moguls used to make their offspring start in the mail room and work their own way up the corporate ladder. Given the range of problems nepotism can create in the workplace, perhaps that’s not such a bad idea at all.