Managing relatives at work is tricky business

Owning a business poses enough challenges but when you add family to the equation, potential human resource and management problems are multiplied significantly. Issues of entitlement, jealousy, productivity, pay and morale are dicey when family members are also employees.
As a business owner, you have to think carefully before bringing a relative into the business. In a perfect world, you might never hire a relative but they may have just what your business needs such as a certain type of knowledge, skills or contacts.
Here are five steps you can take to properly manage relatives to minimize issues at your business:
&#8226 Match their skills with your business needs. Take a close look at your operations and determine what function, skill or knowledge you need to support sales goals, customer demand and deliverables. Business owners typically assign a family member to handle payroll responsibilities. Be forewarned that they can become jealous over what other employees – particularly other family members – receive in pay, increases and bonuses. I worked for a family-owned manufacturing company that distributed annual profit-sharing bonuses. Unfortunately in this situation, the owner’s daughter-in-law became upset because her husband (the owner’s son) received a smaller share than a cousin. It created bad feelings for a long time, resulting in the cousin eventually leaving the business. It was most unfortunate because the cousin was a better supervisor and did contribute more to the bottom line.
&#8226 Set and communicate clear expectations. It’s important to communicate your expectations to everyone – especially to your family members. Assuming, for example, they will only take a half hour for lunch or not send text messages to their friends during work can backfire. Non-family employees who see the family member taking long lunches or using their PDA may not show their displeasure outright but their productivity or attitude will be affected. Ask yourself how many times you’ve had to defend or make excuses for the actions of your relative to an employee?
As an owner, no one will be more passionate about and dedicated to your business. Setting productivity standards and communicating them provides the foundation for all employees to strive to contribute to your success. Leadership is critical to keeping your passion existing and thriving through your employees.
&#8226 Implement a rewards system. Base your system upon expectations and results. Consider what motivates your workers because it cannot be a “one size fits all” rewards program using cash alone. Highly motivated workers are driven by the impact of their efforts and being recognized for that impact. Ever watch American Idol? Usually one judge is particularly harsh or critical. Watch the contestants’ faces when that judge speaks and notice that they pay more attention to what that judge says about their performance. Rewards should be a combination of pay, benefits, bonuses, choice assignments or individual development.
&#8226 Manage performance appropriately. Follow established policies whether or not you have an employee handbook. It’s critical to manage according to policies you have in place. Not managing to policy or past practice for a similar situation creates morale problems, and ignoring any problem will just compound it. One of our clients found themselves in a situation where a female family member was dating an employee. Every time this employee received a raise or was given a work assignment that the relative didn’t feel was fair or right, she would speak to the employee’s supervisor. The supervisor became so conflicted about managing the employee that other employees had to do more work, causing resentment. Eventually we had to step in and counsel her on how to manage her personal relationship at work. Would you be able to speak to your relative about this situation?
&#8226 Communicate, Communicate, COMMUNICATE! Write down the key points you want to cover in any performance or behavioral discussion and be as detailed as possible. If the issue is spending more time making personal phone calls than working, then make notes about when you noticed the calls were made and for how long. Most phone systems can be programmed to track this information for you. Note specific points you want to cover: time on the phone, focus on work, impact to the business and to your relative’s reputation with other employees. Keep your discussion on a business level, stay on point and end with an expected action from your relative (make calls at lunch break instead of during work hours).
In my experience, employees are deeply affected by the perception of fairness. Nothing is more insidious to profitability than employees believing that they are treated differently. Family members are no different except that you have a relationship outside of work. The old saying, “What’s good for the goose is good for the gander” factors into your management of employees but, most particularly, with employees who are family. &#8226
Joyce Maynard is vice president of HR Xpress Inc., a Johnston -based human resources services firm serving employers throughout Southeastern New England. She can be contacted at www.hrxpressinc.com