Recruiting in a Family Business

Shawnee Love   •   March 16, 2019

A few weeks ago, we started blogging on family business and offered 6 recommendations which if implemented would help your family business manage all your workers (family and non-family) skillfully and professionally.   The 6th recommendation required family members to have at least 5 years working outside your business before they join yours.  To be fair, it doesn’t make sense to require a family member to have experience when non-family can be hired with none (e.g., for an entry level job).  Particularly since one of the benefits of family businesses is to offer family members good career opportunities which contribute to the overall wealth and well being of the family.

But when you have a position with responsibility, requiring outside experience sets your business and your family member (if s/he gets the job) up for success.  My rationale for this recommendation is that working in other organizations and for different bosses brings:

  • Knowledge of other ways to do things which can be brought into the family business.
  • Greater understanding of how the family member likes to be managed and what kind(s) of work the person is suited for (often conveyed by a boss who isn’t a parent which is worth its weight in gold).
  • Maturity and life experience.  Working for someone else often increases the next generation’s appreciation for their parents and also sets more realistic expectations regarding work, business, pay, perks, etc.
  • Confidence in boundaries.  Family members who have worked outside the family business, learn how they like to be treated and prepare them to hold their own when coming back in to the family business.  This confidence is important since it is easy for their owner/parents to treat them as kids rather than the professionals they have become.

Hopefully you agree these are 4 good reasons to encourage your next generation to work outside of your business before you hire or promote them into management or leadership roles.

But what about when you have a position come open which might work for a family member?  Or you are just struggling finding someone for a role and a family member offers his services.

My advice is:

First, put the brakes on hiring until you have complete clarity regarding the skills, knowledge, experience and characteristics required to be successful in the job. Setting those requirements in advance and not hiring unless someone meets the minimum standards no matter whose son or spouse they are is critical for the new hire to have any hope of being successful.

Second, ensure that decisions regarding the family member are done objectively and transparently.  Pay special attention to this recommendation when deciding on compensation, bonuses, schedules, etc. because avoiding the perception of favoritism will help your family member integrate your company more easily.

Give your kids their first jobs and teach them how to work. Then encourage them to go out and work and study elsewhere to get the life experience and knowledge they need to come back and be an asset in the future.  When hiring them back, make sure they meet or exceed all your job requirements and ensure they are treated fairly because your employees will hold family members to a higher standard than if you hired someone off the street.

Any questions about how to handle family employment, we are here to help!