Early on I learned a list of hiring "nevers" that were passed on to me by mentors and bosses. They were aimed at helping me navigate the treacherous waters of interviewing by pointing out some very obvious explosive mines.

  • Never hire family
  • Never hire friends
  • Never hire someone right out of school
  • Never hire a felon
  • Never hire someone you are sleeping with, have slept with or want to sleep with

But as I started businesses of my own, I violated a few of these rules–and lived to tell the tale. Here are two that I have violated and what I learned.

Hiring Family

It's fraught with all sorts of danger, but I still know many companies that have hired family. Potential problems are manifold:

  • Being taken advantage of ... either as employee or employer.
  • Favoritism in the workplace that brings back the pain of favoritism felt in the home.
  • Nepotism is another obvious one. The real danger is the diminished respect a supervisor or employee receives because he or she is "the boss's kid."

That all said, I know few small start-ups that have not violated this rule at some point.

The great thing about family is that they "get you." There is a shorthand of shared understanding that can be efficient. Expectations of quality, service, work ethic, and value are taught in the home and naturally carry over to the business.

Hiring Friends

Hiring friends carries all of the issues of hiring family–plus a few additional ones.

  • They know too much. Drinking buddies are not always great employees because they have seen you at your worst. At work, most of us try to operate at a professional level. When someone comes from your personal life to your professional life, they may not understand how to make the shift.
  • Chain of command. There's no "chain of command" with friends. You are equals. In the workplace, however–even in the most casual and collegial work environments–someone has to be the decision maker. And when a decision is made, the team has to execute on it, regardless of individual opinions. Friends can find that awkward.
  • New lens, new picture. Friendly relationships develop context–whether at school, in the neighborhood, or on a sports team. A work environment is a different context–and it is possible that one or both of you will see dimensions of the other person that you don't expect, and do not like.

Breaking the Rules? Follow These Guidelines

So if you're going to break the rules and hire friends or family, I understand why–but make sure you clarify a few things first.

1. Get it straight up front. Have the conversation about how you are going to work together, and what things will change from your relationship outside of work. I have had this conversation with many people I have hired as employees, contractors and consultants. I have fought with, fired, promoted and recommended different friends at different times. In each case, I have taken the person back to our first conversation as to how we were going to work together. It made the pleasant and unpleasant conversations better. Remember: When good things happen, it's just as important that the person knows he or she earned it.

2. Don't overcompensate. A friend of mine once said, "Just because we are friends, don't feel like you get to make me the example every time you are frustrated with the group." I didn't realize it, but I was singling him out because I didn't want other people to think I was showing favoritism. In this case, he was the least of my concerns–but was getting all of the heat.

3. Stay friends. You make friends in the workplace, so the idea that you are friendly or have friends is normal. But establish clear boundaries that don't create discomfort for the people with whom you work–or hang out.

In large companies with hundreds of people, establishing hard rules about friends and family hiring may be more manageable. When you are starting out, often it is those people who believe and make your dreams possible. It's not easy, but it can be managed and the benefits are worth it.