Do You Have a Family Employment Policy?

August 1, 2011 05:29 AM

Kevin SpaffordI’m not surprised at the recent influx of children who want to come back to work in the family operation. I am surprised by how quickly parents forget. Remember when he left for school and said, "I’ll never work in the store again"? Or when she declared, "The family business is just too crowded for me"? Now they’re in love with the idea of working in the family operation. They claim a new level of maturity, real-life experience and talk about how they can help grow the operation.

What’s changed? For most, the current economic climate is causing challenges beyond just paying the bills and keeping food on the table. It’s tough out there in the real world. So, all of a sudden, coming home to the family business sounds like a great idea. And for many parents, it may seem like the opportunity they’ve been pining for...

Please be mindful that this sudden change of heart may not be of the heart, but rather of the pocketbook. It may be a practical solution that will change as soon as the economy gets a foothold on the climb to recovery.

Businesslike environment. To ensure that the family makes employment decisions based on reality, consider adopting a family employment policy. It’s a tool that specifically states the conditions for employment in the family operation. It is designed to spell out the criteria for hiring and employing family members, in-laws and other related individuals. A family employment policy helps the owners, managers, employees and family members maintain a businesslike environment in the operation.

A family employment policy should encourage owners and managers to base their hiring decisions on readily accepted written policy, rather than on emotional impulse. It should specify the minimum education, experience, skills and abilities that must be attained prior to employment. Companion documents to a family employment policy are a job description, a statement of wages/benefits and an employee manual.

I suggest the following example as a good starting point for an employment policy:

"As a family operation, we are committed to employing family members who demonstrate integrity, act accountably, are industrious and work to further the mission of this operation. We expect participating family members to be appropriately educated, community minded and loyal to the employee team.

"Each participating/prospective family member is encouraged to develop his or her skills and abilities. A person is not truly engaged and fulfilled until he is making constructive progress toward a goal. We will recognize and reward initiative, persistence, self-reliance and interdependence. However, we will only employ family members if and when there is a job opening and the individual possesses the education, experience and skills necessary to fulfill the job requirements.

"It is management’s responsibility to employ individuals who:

  • have the ability to grow as a member of the team.
  • demonstrate the ability to take initiative.
  • exhibit confidence and self-regard.
  • are both responsible and accountable for their actions.

"Working in the family operation is a privilege; not an entitlement. Opportunities for employment are based on merit. We will hire based on company need. Applicants will be selected according to the skills, abilities and attitudes they bring to the workplace. The performance of each employee will be formally evaluated on a regular basis. And, if a family member does not meet company expectations, he or she may be released to seek employment outside the family operation.

"The ownership team will not compromise the integrity of the operation by hiring any individual who is not committed to and prepared to succeed in the family business environment.

Conditions of Employment:

  1. Family members will be held to the same standards as non-family employees/applicants.
  2. Family members are expected to meet the same levels of performance and follow all procedures as non-family employees.
  3. Family members will be subject to regular performance reviews and held to the same standards as non-family members regarding behavior. 
  4. Family members will be supervised by and held accountable to non-family members.
  5. Compensation will be a fair market wage according to a job description, level of responsibility and accountability.
  6. Family members seeking permanent employment must have [desired education level] and at least [number of years] of full-time work experience outside the family business.
  7. If a family member is not employable in another occupation or for another operation, he or she will probably be neither satisfied nor successful working under the often stressful conditions of this family operation.

Applying for a Position:

  1. Family members interested in working in the operation must apply for an open position. They must submit a resumé and cover letter citing a specific job opening.
  2. When there is an opening, family members will be notified and those interested will be considered for the position.
  3. If there is not an applicant (family member/non-family) interested in a position, the job opening will be posted on the appropriate sites, publications and/or agencies. 

"The owners reserve the right to make any and all employment selections. The complexity of our business may necessitate the appointment of non-family members to any and all management positions, especially if and when a successor is not readily available or not prepared for a particular position."

Kevin Spafford serves as Farm Journal Media’s succession planning expert. His firm, Legacy by Design, guides agribusiness owners through the succession planning process. Send questions to Legacy by Design, 2550 Lakewest Drive, Suite 10, Chico, CA 95928, (877) 523-7411 or

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