Anyone who has started a business can tell you that finding qualified people to work under them is one of the hardest tasks to accomplish. For those who are facing this dilemma, hiring friends or acquaintances might seem like a natural and easy choice. You already know each other and your friend likely believes in you. This strategy does not always pan out, and it can backfire badly in some cases. Should you hire a friend to work for you? Consider the following factors before you sign any of your friends to a contract.

SEE: Starting A Small Business: Hiring Employees

Is He or She Competent?
It can be hard to evaluate a close friend as a potential employee, so it may be wise to get an unbiased opinion. Ask another recruiter or professional in your field what he or she thinks of your friend's resume and job history. Tell him or her why you think your friend might be a good fit at your company and see what the recruiter says. If your friend has a solid record of doing whatever it is you're hiring him or her for, then you may be on solid ground. You likely won't need to do a background check or much other investigating on the candidate, since you already know his or her history.

Relational Impact
If you hire a friend to work for you, the nature of your relationship will likely need to change at least somewhat in most cases. Will your friend be willing to take orders from you? What will happen if he or she makes a mistake? Will you be willing to discipline someone you'll have to associate with outside of work? How will he or she respond? Some friends could also use this job as a means of taking advantage of you, especially if your pal knows that you aren't likely to fire or confront him or her about poor job performance or other issues.

Workplace Impact
If you are hiring a buddy to perform the same duties as several other people, you need to be sure not to bestow favorable treatment on your friend or discriminate in his or her favor over others. Be sure to talk through this issue with your friend beforehand so that there are no surprises. If your friend seldom takes you seriously now, then be prepared to deal with this issue on the job. It can lead to problems with other employees when they see your friend refusing to take you seriously. If you have a personal falling out with your friend, how is that going to affect your relationship in the workplace?

Treat your friend like any other employee that you hire and clearly convey all pertinent information, such as job duties, hours, and working conditions and compensation. Have him or her apply for the job just like any other candidate and sign the same contract as other employees. It may also be wise to hire your friend on a temporary trial basis first and see how things go during the trial period. If things go smoothly, then it is probably safe to keep him or her on.

SEE: The Cost Of Hiring A New Employee

The Bottom Line
There is no absolute right answer when it comes to whether or not you should hire a friend to work for you. This issue is contingent upon a number of factors, such as the nature of your friendship, the position that he or she would fill in your company, the nature of your business and the environment in which you would be working together. While hiring your friend may be tempting in many cases, your head should prevail over your heart in this decision.

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.