The playbook on family

Posted by Jonathan Cook, Senior II, Tax Services on May 25, 2017

As any dealer will tell you, running a successful dealership is already challenging enough without managing the risk of family dramatics spilling over into the day-to-day operations. To get ahead of these types of risks, you must make the separation of business and family unmistakably clear. A formal, written family employment handbook is one way to do this.

A familial FAQ

In order for your family employment handbook to detail the expectations and requirements for family members, it should answer questions like:

  • What level of education and/or training must family members reach before becoming an employee?
  • Should family members work at an unaffiliated business before working at the dealership in order to better understand life outside of a family business?
  • What are the compensation guidelines for family members?
  • What are the promotion criteria for family members?

Your handbook should also address the hiring process for family members. It is wise to subject family members to the same formal hiring process as nonfamily, without any family involved in order to avoid accusations about objectivity.

Set expectations for a fair work environment

The goal of your family employment handbook should be to make family and nonfamily employees feel as if they are on a level playing field. Once the perception that family members are receiving preferential treatment has been cemented, it can take years to repair your dealership’s culture. By creating a handbook that formalizes clear expectations for family members, you can bolster objectivity at your dealership.

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Topics: Auto, Accounting Tips, Tax, Audit