“I can’t fire them—they’re family” can be a dangerous phrase in a family business. This deep-seated loyalty can create complications in the business if loyalty over performance is prioritized. Among the many excuses for not parting ways with family are: “It’s not a good time”; “This will end my relationship with them”; or “It will cause a rift in our family.” These are the most difficult rationalizations to overcome.
That’s why it’s important to separate excuses from reality and prioritize the organization’s true goals. It might even be that a missing road map is the source of tension between family members, and with some clarity, everyone might find relief.
In that business-planning journey, it’s critical to define each person’s role in the company and what’s expected of them. If this role is clearly defined, it’s much easier and less emotional to point to specific instances where performance is affecting outcomes.
Hard decisions require the right reasons
Timing will never be perfect to fire anyone, especially a family member, and delaying the decision can have far greater emotional and financial implications than taking swift action. Timing aside, there are a few ways to tell if it’s the right time to part ways with a relative.
Whether the teammate is part of the family or not, character flaws—especially regarding ethics—are not worth the time to “rehab.” These include stealing, lying, harassment or sabotage for personal gain. When these severe forms of manipulation occur, it’s critical to cut the source—even if it means firing a parent, sibling or child. Leaving a harmful individual in the business may cause other team members to quit, the company’s reputation to wane and collaboration to fall apart.
The harder decision is when the family member has poor performance over a long period of time. When analyzing whether their performance is egregious enough to warrant termination, look at two things: the cost of errors that have affected the business over a one-year period and the person’s attitude toward improving.
If the cost exceeds what you are paying them, that’s a clear indication of a problem. When their attitude is not focused on improvement or they do not care about the outcome, you must address it before it becomes too late. Without the will to improve, an attitude will put up a wall that makes it difficult for both parties to climb over.
Navigate tough conversations
How do you address the elephant in the room? Privately, with empathy and facts.
At the first sign of trouble, have a private conversation with the family member about what you have experienced working with them. It’s important to remain levelheaded and calm so that the other party does not become defensive. Both parties need a chance to discuss freely what’s on their mind because there may be another side to the story.
The meeting should not feel like an attack; instead, discuss the importance of protecting the family dynamic and finding a solution to move forward. Through this conversation, it may be possible to improve performance and resolve the conflict. Consistent weekly meetings after this point for a predetermined amount of time (for example, one quarter) will be necessary to course correct.
If the review period ends and the employee shows no improvement, the first step toward separation is accepting you will be letting them go. This critical step separates the mind from the heart and allows you the freedom to make tough decisions. Firing them in your heart does not mean being cold or hurtful; it gives you the clarity to move past grief and start planning. Depending on how long they have been with the company, it will take time to create a plan, talk to the team and family and work through the transition.
The second task is to have a final conversation with the family member on the decision to part ways. Like the first conversation and weekly meetings, take an empathetic and factual approach to protect the family dynamic.
During this final conversation, discuss the last day, payout terms and what you need from them in the transition. This meeting should be brief and focused on next steps without room for negotiation. If you have been meeting weekly for a quarter, every concern should have been addressed by this point.
Whether a severance is due to the family member depends on the length of employment, managerial role or ownership, and whether the separation was amicable, among other potential factors. If a severance is warranted, a lawyer can draft terms
to protect both parties.
Another crucial step at the time of termination is addressing the remaining team and what the transition will look like. When a family member leaves, other team members will be impacted. Put their minds at ease by explaining in a brief and respectful way why the person is leaving. Offer support through the transition and be open and transparent without gossip or oversharing details. How you handle this conversation will illustrate to the team your culture and what is acceptable.
What about the family?
Managing the family dynamic outside of work will make or break a long-term relationship. After separation, prioritize space, and go back to the roots of your personal connection. Allowing everyone to have space should give much-needed relief, but don’t let it go on too long without reconnecting. Continue to show you care for them and the rest of the family, and the wounds will hopefully begin to heal.
It’s natural for other family members (whether they work there or not) to question the decision or not understand how it occurred. This can cause a domino effect of questions, concerns and emotions about the separation.
It’s important to use empathy in your interactions, but be cautious in what you share. Ideally, before separation, there should be a conversation about how to share the news with family as a united front and how to answer questions that may come up. Ultimately, no matter what details are shared, someone’s feelings may be hurt. Be diplomatic, don’t gossip and always respect everyone’s feelings about the matter.
While it’s never easy to fire a family member, it can allow for personal and professional growth. Making this difficult decision should have immediate positive impacts once it’s done. Ultimately, the time and process leading up to the separation is the most painful part; once it’s done, the pain should start to fade.
Jessica Harling is the founder and CEO of Behind the Design® LLC. Her background in process engineering and a legacy in family business informs her firsthand understanding of its growing pains.
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