Don't Hire Your Relatives at Your Practice

January 11, 2017

Hiring a relative is an easy way to fill an open position for many practices. Here are the reasons why NOT to do that.

At one time or another, most physician owners will face a critical job opening and have a seemingly perfect solution: a capable, trustworthy, fortuitously unemployed family member. After all, it's your business and your money. Who could you trust to more to guard it than your spouse or your child?

Practice managers also often see tidy solutions to tricky staffing problems in their job-seeking children, siblings, nieces, and nephews. Even though they don't own the business, managers are often challenged to do more with less. When every budget dollar and every staff position must be as productive as possible, the idea of bringing aboard a new employee who definitely has your back is very appealing.

It sounds logical, doesn't it? But what if I told you that hiring family members is one of the most common preventable mistakes physicians and practice managers make - and that it's something we routinely see the consequences of in our consulting work?

It's rare that the best or only option for filling a key role in your practice will be a family member. Moreover, doing so often leads to more problems than it solves. Here are some of the reasons why bringing aboard a relative of a partner or manager can do real damage to your practice.

• Your relationship is at stake, along with your business. The main reason hiring a relative is so appealing is that you believe he will always have your best interests at heart. But what if that's not enough? For a key role such as practice manager, certain skills and knowledge are essential, and you must agree on your business strategies and policies. If you hire your spouse and it turns out she doesn't have the right skills to run your practice, will it damage your relationship to tell her so? Or will you hold back from confronting problems to protect your relationship, even though the practice business will suffer the consequences?

• Unfairness is all-but-unavoidable. You'll no doubt make an effort to avoid any favoritism, but odds are you'll fail. After all, the main reason you hired your relative is that you trust him more and your other employees will perceive that - and that can undermine morale. And if you resolve to try even harder to avoid any bias - or any appearance of it - you could wind up being unfairly tough on your relative instead. That, in turn, could lead to conflicts in your family.

• Hiring family causes a chilling effect. Employees are often the first to spot problems in patient service or workflow, but if doing so involves offending or criticizing your related employee, employees won't feel free to tell you what they see. For physician owners, this can be especially destructive when the family member's behavior causes problems for the team, and staff won't speak the truth because of your family relationship. It can be difficult, if not impossible, for physicians who are busy seeing patients to figure out what's actually causing poor morale or turnover. It will take a lot longer when employees won't tell you. Similarly, managers may have no idea that the son or niece they hired to help enter data or scan charts is actually doing a poor job and creating more work for everyone else, because staff fear repercussions if they speak up.

• Hiring family affects partnerships and undermines recruiting. Often when doctors hire relatives, their practices are small and may be just starting up. A husband or wife working for below-market wages as an investment in your shared future can be an attractive solution in early days. But what happens when you're ready to grow? Having one partner's spouse in charge of practice finances can be a source of friction - even distrust - among partners, especially as the dollars involved increase. And if you're trying to bring a new partner into the practice or just another physician, you could scare excellent candidates away if they're familiar with the challenges that can come with being part of a family business.

• Your relationship may go south. Divorce and other family upheavals can happen unexpectedly. If you're employing your spouse, there is always a risk that she could become unhappy with you and manifest that displeasure financially. We've heard of practices in which the physician owner was not just unaware that their spouse was unhappy, but also unaware that she was siphoning money from the business. Embezzlement can be harder to fight when a spouse is involved - and the damage will affect everyone else at the practice, not just the one who hired the embezzler.