Question: Is it acceptable to have a company policy that forbids hiring anyone who has a personal relationship with an employee, without corporate office approval?
Answer: While we cannot provide a legal opinion on this type of policy, for general information we believe it is common for employers to have policies which prohibit allowing family members or those with romantic relationships to be in a direct reporting relationship.
It is critical that employers considering implementing these types of policies be able to show valid business justification for the policy and ensure that there is not unintended discriminatory impact. One of the red flags we see in the suggested policy above is that the term “personal relationship” is fairly broad. We recommend being more specific about the type of relationship that the employer is referring to and whether there are any boundaries. For example, can a new hire work in the same department as the current employee so long as they are not in a direct or indirect reporting relationship? Providing some additional clarity may help with administering the policy as well as clarifying for employees what is and is not allowed.