Members of the owner family may naturally wish to work in the business. But, people vary in personality, attitude and behavior and conduct even if they may belong to the same family. Different work ethics, habits and commitment levels among family members working in the company often become a source of friction. Hence, the founder(s) must be very clear about the approach they wish to take for the inclusion of the family members in the business. In the interest of the business, the founder(s) must objectively prepare and implement a transparent policy for selecting family members as employees in the business.
- The policy must clearly spell-out how will the company absorb family members in the business.
- How will the company select family members for working in the company?
- Will it favor merit or will give concessions to the family members?
- Will qualification and/or experience be required for the family members or will they be given concessions in the selection criteria?
- Will all siblings or equal relations be given equal positions and compensation or it will depend on their merit, qualification and skill?
- Will the rules, promotions, compensation structure be equally applicable to the family members working in the company or they will be above the rule?
- What will be the criteria to be an ordinary employee in the company and what will be criteria for a leadership position in the company?
- Does the family member have a freedom to choose their employment elsewhere, outside the company?
- What is the process a family member needs to follow before exiting the company?
- In which circumstances the family member may be removed from the employment of the company?
- It is advisable to clearly specify the answers to the above questions and communicate to all the members of the managing family.
- The company’s expectations in terms of following the mission, vision, values etc. from the family member employees should be clearly mentioned in this policy.
- The family members must get a clear idea about their future prospects in the company and the requirements or conditions for the same.
- A fair, transparent compensation policy for family member employees consistent with the Human Resources policy of the company should be adopted and explained here.
- It should be clarified which company facilities and privileges they can enjoy free and which they can’t.
- The policy must clearly differentiate between the company benefits, facilities and privileges available to those family members who work for the company and to those who don’t work for the company but simply remain passive owners of the business as members of the owner family, charting their own independent career paths outside. Those working for the company must get a better deal in such benefits for their contribution, even though their share of ownership may remain as per the family constitution.
- The family members entering the business must be encouraged to come to add value and not to suck value out of it. Their inclusion must help the business in facing the challenges it confronts. The family member selection policy must spell this out clearly and the founder(s) must explain this to the every member of the family.
- A clear, transparent and fair policy and its appropriate implementation will avoid a lot of confusion and misunderstandings arising out of the family members working in the business.
(Expert advice to GROW your business wherever you are, whenever you want.
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