Subscribe to Entrepreneur for $5

The Real Reason Not to Hire a Friend

This story originally appeared on BBC Capital

When Jason Raftis was a sales manager at a car dealership in , he decided to give a longtime friend a job in his department.

He quickly realised his mistake. The friend started making a habit of detailing their college exploits in front of other employees — and that was only the start.

"[It] turned out to be a nightmare," recalled Raftis, who is now a services account executive. "Because of our , he took it as a license to come and go as he pleased and took liberties that other employees would never take."

Raftis eventually fired him. His advice: "Stick to strangers. They're way easier to manage and even easier to fire."

Related: What I'd tell my younger self

Whether as a boss or subordinate, mixing friendship and work has many potential pitfalls. Before you hire a friend — and more importantly, before going to work for a friend, it's crucial to weigh the pros and cons.

A poor hire can give you a bad reputation and reflect badly on your judgment, not to mention damage a friendship. In addition, personalities can change — and not always for the best — when people move from friend to colleague.

"What if the friend is uber-competitive and wants to best you, causing complications in existing business relationships?" said Dallas-based Nancy Keene, founder of The Perfect Fit, a leadership consultancy, in an email. "Not everyone can cross over."

Make it official

Wanting to help a friend can set off a messy trail of unintended consequences, according to Keene. One way to keep the friendship intact, but help a friend get a job, is to defer to the human resources department. It's common for companies and executive recruiters to ask for referrals from employees.

If it is a large organisation or a retained firm, the friend will undergo the same level of scrutiny and evaluation as any other candidate. "If they don't get through the screening/interviewing process, they won't get the job. You've done a nice thing for a friend, but you are not the decider, and your friend can't be unhappy with you if there is no hire," said Keene. "Likewise, if the friend is hired and things go wrong… your hands will be clean."

Of course, hiring a friend doesn't always have devastating consequences. If you were colleagues before, left for different companies, and now are teammates again, it can be a great fit for both sides. You already know each other's and that can be a positive.

"When a friend asks you to come work for him or her, it can indeed be a great feeling of recognition and support," said Dr Lorraine Tilbury, founder of personal and professional development firm HorsePower International based in France's Loire Valley, in an email.

Both sides of the equation

The pros and cons work both ways. If you're the one being hired by a friend, be sure to examine the opportunity as objectively as possible, said Dr Andrea Bonior, clinical psychologist and author of The Friendship Fix, in an email.

"You need to evaluate whether it is a good job for you, independent of the fact that your friend works there," she said. "There is a chance that you are biased because of wanting to be with your friend and might not be realistic about the job."

Related: Overworked? It might be your own fault

For example, have you considered things like salary, the commute, advancement opportunities, whether it's a challenging position?

"Sometimes, friends want to help you out and can end up offering you to do something for them that you don't feel is the best "fit' for you," said Tilbury. "Just as for any other potential employer, reflect on the pros and cons of the job offer."

Get it in writing

How well do you know this friend? Do you trust him or her in business? What happens if it doesn't work out?

"These are all questions you should ask yourself before committing to working for [a friend]," said Anita Pickerden, a Birmingham, UK-based work life balance coach, in an email. No matter how well you think you know the person, you need to get all of the details of the job in writing before your start. "You may be very good friends now but if you fall out later then you want some proof of the original agreement," she said.

Some conflict is bound to happen, according to Tilbury: "No matter how strong your friendship is between each other, disagreements will inevitably arise, so it's essential to talk about how they will be addressed."

Doesn't have to end badly

It is important to ask the same questions you would of any "boss to be," said Rich Wellins, a senior vice president at Development Dimensions International, a US-based global human resources consulting firm, in an email. Before saying yes, ask yourself the following, suggested Wellins: Are you comfortable with a hierarchical relationship at work and an equal one outside of work? Are you willing to back your boss even if you disagree? Do you clearly understand what your goals and expectations are ahead of time?

"Your job matters almost more than your relationship with your friend-boss," said Wellins. "I know many people who dislike their job but still like their boss. Who you work for is critical but not everything. People end up working for their friends every day... In most cases things just work out fine."

Related: The super secret weapon of CEOs

Entrepreneur Editors' Picks