Q: Our CEO is concerned about employees who are spouses reporting to one another. Is this legal? Should we have a policy against nepotism? Or should we allow it with some qualifications?
A: We think your CEO’s concerns are warranted. There is no law against employing relatives. In fact, nepotism is quite common in the United States. That said, there are some precautions worth considering.
As a best practice, we generally recommend allowing family members to work together, but not directly report to one another or have access to one another’s confidential employment information. That way you’re free to hire applicants who may be the best fit for your organization, but you avoid potential conflicts and complaints of unfair treatment that can come with direct reporting relationships among relatives.
It’s worth noting that if you already have relatives reporting to one another, it’s best to not have a policy like this. You don’t want to create a policy that you’re already violating!
Exceptions are regularly made for minor children of employees who may be hired to do something fairly simple over summer or winter breaks and often will report directly to their parent. This situation is less problematic because the parents are in charge of their children outside of work and their working relationship is temporary.
When creating your policy, make sure it clearly states which relationships you allow and do not allow, and what will happen if a relationship arises after hiring (e.g. a marriage of a supervisor and subordinate who met at work). Then make sure you follow it consistently.
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