Some people may view hiring family as an advantage since they may be willing to work at low rates for your start-up. The following are some reasons why you may not want to hire family to do business.
1. Business could come into family functions
There are some people who have an amazing ability to separate their personal lives from business but most people are not really good at it. Birthday parties or get together events are not the time to discuss nasty events or stressful circumstances. You do not want to see tensions happening in front of family and friends.
2. Emotion is always involved
Emotion is part of any relationship. For example, if your cousin who works for you is underperforming, you may have to give them a talk on how to improve their performance. A cousin could take the advice personally and could make the relationship between you two messy.
3. Limited communication with colleagues
It is unlikely that your staff members will speak to you openly about your cousin or relative at the business. Imagine if your relative is incompetent or transgressing behind closed doors. Do you think that your staff will mention it to you in a hurry?
4. You are more likely to work without a contract
You should always get people who work for you to sign a contract. This will ensure protection to both parties. The contract will allow both parties to understand the expectation with regards to the scope of work. When dealing with a family member, you may be hesitant to ask them to sign a contract.
5. They may expect extra freedom
Not every family member is guilty of this but there are some who may take advantage of the fact that they are dealing with family and take extra time off, miss deadlines and come in late.
Source Link: https://www.entrepreneur.com/article/296592