Published 10 Jul 2023

How to Manage Nepotism in the Workplace

Michael Yi

Nepotism is a form of favouritism towards family members or friends, especially in a work environment. This may manifest in the form of an employer offering a sought-after job to a family member, or giving promotions and other special treatment to someone who doesn’t deserve it as much as another employee might.

Nepotism in the Workplace

Nepotism (sometimes called cronyism or written as nepatism) is more prevalent than you may realise. We’ve all heard the adage “It’s not what you know, it’s who you know”, and unfortunately in the case of nepotism, this can be an incredibly unfair setup. In fact, about 22% of American sons will be working for the same employer at the same time as their fathers by the age of 30, while 61.3% of Brits say they have seen nepotism occur in the workplace or been a victim of it.

Networking and being referred to a job thanks to your connections is all well and good, but can turn into favouritism if you are unfairly given opportunities or treated with leniency as compared to other employees.

Some examples of nepotism in the workplace include:

Underqualified family members and friends being recruited before a job is advertised
Giving certain employees more opportunities for development or progression
Giving certain employees precedence when it comes to approving leave and flexible work arrangements

Promoting favoured employees despite them lacking the relevant skills and qualifications
Giving certain employees more opportunities for development or progression
Inconsistency in the standards that are set for favoured employees versus others

Of course, working alongside family members isn’t inherently a negative thing and personal relationships do sometimes spring up in the workplace. Having favourites is natural to an extent, and there may be certain elements of your business you’d rather entrust to someone familiar. During the early stages of your business, it is also easier and cheaper to hire friends and family first than invest in recruitment. However, if relatives are given preferential treatment or greatly sway your decision-making, it becomes a form of discrimination.

Effects of Nepotism

Nepotism can create a hostile environment in which employees are disgruntled and undervalued. Employees may start to view their employer in a negative light, reducing employee confidence in managerial power and authority. They will also start to question whether it is even worth putting effort into their work if favoured employees will be promoted anyway. At best, employees will be disengaged, you may overlook valuable talent in your company, and your company may suffer from unqualified family members holding high ranking positions. Exceptional employees may also end up leaving the company altogether to find more rewarding employment. At worst, you may face a lawsuit due to mistreating the rest of your staff.

The favoured employee may even start to suffer as a result of the preferential treatment they receive, as they may struggle to make friends within the organisation or not be able to develop professionally due to always being coddled.

Managers, employers and team members can all take steps towards handling or minimising cases of nepotism in their workplace. From keeping employee morale and wellbeing high to avoiding possible litigation, it’s well worth eliminating all favouritism from your work environment. Whether you are a manager or employer looking to prevent instances of nepotism or an employee facing nepotism in your current role, here are some ways to best handle nepotism at your organisation.

For Managers and Human Resources Officers

Set up a transparent recruitment process which involves objective decision-making.
Educate and inform managers and employees on avoiding discrimination in the workplace. A training session on what nepotism or favouritism is and what employees should do if they notice it.
Encourage communication so that employees have a clear point of contact for reporting any workplace issues.

Add a conflict of interest or nepotism policy to your overall discrimination policy to ensure standards are clearly outlined.
Get to the bottom of any issues that are reported, even if it is a sensitive matter. If you notice any signs of nepotism, nip the problem in the bud before any employees are forced to complain about it.

For Business Owners

Avoid hiring family and friends
Resist the urge to pull family members and friends into your new business, and try to hire outsiders instead. If you do hire family members, try to ensure they are not your direct reports. Remember that hiring outsiders can also be incredibly beneficial to your company as it injects fresh, new ideas into the team.
Create anti-nepotism policies
Have written guidelines and policies in place on avoiding discrimination in the workplace. These rules should apply to everyone, even if you do have a family business, to ensure that there is no preferential treatment. Some policies to consider include prohibiting one relative from supervising another, or married couples from working together.
Treat performance seriously
Require all employees to work their way up and reward hard work. Hold regular performance reviews to ensure people get the promotions and pay rises they deserve, instead of receiving handouts simply for being close to you. This may even be a blessing in disguise, as second-generation leadership can be prone to collapsing!
Assign work fairly
Try to keep track of who has already received the more prestigious projects and who has been doing admin work. Rotate the work around from time to time to ensure everyone is feeling valued.
Hire mentors
Hire mentors if you do have to train a family member or friend. This will help them enjoy professional development and mentorship without any potential bias from you.

For Employees

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Start building a case
Document any instances of nepotism you are concerned about. Contact your HR department with these specific incidents to build a case. You may want to speak with more than one member of the HR department to ensure your case is made prominent, or seek out a third-party ally that is in a higher position than you.
Stay professional
Remain professional and friendly when discussing potential nepotism in the office. This is not the time to slack off, act out or gossip – leave any venting to your own friends and family. Being a whistle-blower is not easy, so be prepared for backlash when fighting to create a more ethical workplace.
Back yourself for the job
Document your achievements so you can best argue your case when it comes to receive a pay rise or promotion. This also helps you avoid making your argument about someone else, and instead focus on what you deserve.
Take care of yourself
Combating nepotism can be stressful, so make sure to indulge in your favourite hobbies at this time to remain confident and clear in the office as well.

Nepotism at work can be frustrating, and needs to be dealt with at different levels. With the tips above, managers and employers can help to prevent nepotism in the workplace, while employees can learn how to better handle nepotism if faced with it.

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