Understanding Nepotism

Favoritism pervades many parts of society — the manager who treats one employee better than the rest, the hostess who seats the couple who arrived after you or the policeman’s aunt who always speeds but never gets a ticket. The workplace is no exception; when favoritism occurs at work, it is called nepotism. Nepotism in the workplace can lead to dissatisfied employees and opens employers up to accusations of unethical conduct. Every employer should understand what nepotism is, its impact on workplace culture and how to identify and correct it.

What is nepotism?

Nepotism is a type of favoritism shown toward family members, specifically. Merriam-Webster dictionary identifies the Latin root of the word as?nepos, meaning?nephew. Nepotism can involve any relative, though, including those related by marriage. Nepotism occurs when those with the power to hire or promote within a company ignore more qualified candidates to hire or advance a family member instead. Nepotism at the workplace also occurs when employers treat the related employee better than other employees. Some examples of this are:

• Ignoring the family member’s habitual lateness
• Assigning less work to the related employee than other employees
• Promoting a family member over other more deserving employees
• Not addressing the relative’s poor work performance

Other examples exist, but their prevailing theme is preferential treatment of family members over other employees.

Types of nepotism

Defining nepotism is straightforward, but not its application. Sometimes where it occurs changes others’ perception of it. For instance, a practical difference exists between nepotism in a small business versus in a large corporation.

A small business employing family members is often expected, even considered standard. For instance, the owners of the typical mom-and-pop restaurant may hire their children as part of the staff even if they’re not fully qualified. The parents intend to teach the children the business for the day they eventually inherit it. This is nepotism, but it makes sense that parents would want the children to learn the business by working in it.

Even so, if the parents/owners promote relatives unfairly, other employees recognize the injustice. Small business owners can avoid accusations of impropriety if relatives work their way up instead. For example, if someone owns a family restaurant, a son might start as a waiter, move on to become the host and from there the manager and ultimately the owner. This not only helps the children know the business from the ground up but also diminishes the appearance of nepotism.

Nepotism within a larger organization seems less tolerable. When those in managerial positions hire unqualified family members, there’s no ownership to pass on to the relative, unlike in a family business. Employees recognize favoritism as the main reason for the hire. Employees want to feel as if they have the merit-based opportunity to move up in the company. If they sense favoritism toward a relative, they would rightly accuse the manager of unfairness.

How to spot nepotism in the workplace

If your manager hires a family member, is that always a problem? Not necessarily. It depends on whether the manager has favored the relative unfairly. Be attuned to these examples of nepotism:

The related employee is under-qualified

If company officials hire family members who are clearly unqualified for a position, this could signify nepotism. In such cases, speak with the supervisor to learn more about the reasons for hiring the family member despite the lack of qualifications. For instance, you may learn that the supervisor believes the family member qualifies because of transferable skills and certain personal characteristics. A conversation will help employers determine if the reasons are valid or unethical.

The relative demonstrates unprofessional behaviors

A supervisor’s relative may behave unprofessionally at work. Maybe they’re rude to other employees or customers, or they’re insubordinate because they know the company won’t fire them. This shows that the employee doesn’t fear losing the job, which may signify nepotism.

Family member evades punishment

If managers aren’t reprimanding employees for those unprofessional behaviors, that is evidence of nepotism. This is particularly egregious if the manager points out such behavior in other employees.

Again, communication is important: Speak with your managers. Doing so will uncover any unethical behavior as well as alert them that such favoritism is unacceptable.

Other employees have complained to you or HR

Lastly, if your employees address their concerns about nepotism directly to you or HR, this is an obvious sign of nepotism that you must address. Meet with those employees to learn more about their observations. Let them know they are heard and valued.

Keep a record of these events before making assumptions or taking preemptive actions. If the behaviors continue, speak with the employee and the person who hired them to determine the appropriate next step.

Negative effects of nepotism in the workplace

Nepotism doesn’t occur in a vacuum. It can hurt employers, employees and the entire company. A few of the negative effects of hiring unqualified family members are that it:

Creates an unhealthy work environment

Employees may feel undervalued if they notice family favoritism at work. Imagine a loyal employee who regularly arrives to work early, performs the job well and gets along with coworkers. Now imagine that employee’s reaction when an expected promotion goes to the manager’s undistinguished niece instead.

Such behavior fosters resentment and hostility. The ripple effect of nepotism can turn a once healthy workplace toxic.

Reduces employee morale

Nepotism reduces employee morale by making employees feel the deck is stacked against them. Employees may wonder why they should try to do their best if being the boss’ relative is the main criterion for promotion. Their belief in the company’s mission fades. This leads to employees giving the bare minimum rather than their best effort.

Increases employee turnover rates

Poor morale caused by nepotism has consequences. You may lose valuable members of your workforce. Talented employees who notice nepotism may leave the company to go somewhere they feel will treat them more fairly.

Replacing good employees isn’t cheap:?Hiring expenses— e.g., recruitment, job board fees, background checks, etc. — and?training new employees can be costly.

Contributes to decreased productivity

Qualifications matter. Unqualified employees cause productivity to suffer. When managers hire or promote ill-equipped relatives, they’ll likely make more mistakes than other employees that someone else has to correct. Both slow productivity.

Putting a number to the cost of lost productivity is difficult, but common sense shows that an unqualified employee’s salary is just one part of the wasted money from nepotism.

Decreases employee respect for leadership

Respect for managers is important for employee engagement. When those with hiring and promotion power make poor decisions, such as hiring unqualified relatives, they risk losing employees’ respect.?Recent data shows that nepotism causes employees to view leaders negatively. Bitterness, insubordination and less dedication to the job are just a few consequences of lowered respect for company leaders.