When you raise the subject of hiring relatives with small business owners, you’ll usually meet with one of two very different attitudes:
1). That’s what having a business is all about – being able to offer your family members a secure job.
2.) I would never hire relatives because it can cause too many problems.
For the second group, the idea of hiring family brings up all the “cons” while for group one, the “pros” take precedence. If you’re thinking about hiring relatives in your small business, here are a few initial pros and cons to consider.
Cons
- You lose the separation between family life and work life because your family life goes to work with you and vice versa. which leads us to the next potential problem…
- Seeing your family members all of the time, inside & outside of work hours, can lead to increased squabbling.
- It can be hard to be honest with relations about mistakes they’re making or the quality of their work. Criticism from a family member can be more difficult to accept than the same criticism from an unrelated employer. This can make it difficult to offer feedback and train a relative.
- When one family member feels like they are doing more work than another, a disputes can arise and this is then carried home.
- Sometimes, family members can think of themselves as not really employees – after all, it’s a family business and they’re related to the boss! As a result, they might assume they don’t have to work as hard.
- If you own a business and you’re employing relatives, there can be an increased expectation in regard to pay and conditions. If it’s perceived that you’re making decent money, related employees can expect you to spread it around.
- A relative of the boss may be perceived by other workers as being favored – and this can create dissent in the workplace.
- Your family members will know much more about your financial circumstances and how you spend your day than you might want them to know.
- Family often feel free to offer their unsolicited opinions on everything.
Pros
- You get to spend more time with your family.
- Family working together on a business can be a formidable force in business growth if everyone is motivated to succeed and willing to put in the necessary work.
- Your business is generating money for the family, not paying it to others.
- A strong business may be able to offer secure, well paid employment to any family member who needs work. Allowing your loved ones to enjoy life more and worry less about the future can be a joy in itself.
- If you have older children, you might be able to bring them into the business when they graduate, offering them immediate security and a good start in life.
- Family members could have skills that will let you expand your business.
- When times are tough, family can pull together to get through it. They may be prepared to take a pay cut or work less hours when things are slow.
- Working together in a business can be something that holds a family together through good times and bad.
- It can give you improved flexibility when it comes to taking time off.
Okay, so this is a pretty simplistic overview above, and really it is going to come down to the type of family you are. If family dynamics tend towards privacy and secrecy, or even competitiveness and jealousy, bringing it into your business could be a recipe for disaster.
On the other hand, if they’re open, share information freely, enjoy each other’s company and are flexible, it’s something that could make your business thrive – and be a great relief to you.
It’s a big step to take and it’s likely you already have a good idea whether it’s something you want to do or not. It’s wise however, to consider all of the pros and cons before making a final decision because the decision will have a major impact on the future of your family and your small business!
How would you feel about employing family?
Article by Christie Lewis
Christie is Practice Manager at Alan Lewis Accountants . Besides accounting, her passion is for all things small business (and blogging, of course). You can contact Christie directly at christie@lewistaxation.com.au.
Christie has written 811 awesome articles for us at Alan Lewis Accountants – BLOG
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