Parent trap? Keeping mom or dad busy in their retirement years may be a noble reason to hire them, but be sure you know what you're getting into first

Entrepreneur, March, 2005 by Mark Henricks

JAY OXENHORN'S most faithful employee is also probably the least likely of his 10 employees to work long hours during the Philadelphia product manufacturer and distributor's seasonal busy times. But the 49-year-old cofounder of Hot Headz of America Inc. doesn't mind.

"She's my mom," Oxenhorn says. "She's in her 70s and basically needed to get away from my dad all day, and the income helps her. So she's my order-entry and retail order-taking person on the phone."

Having his mom on the payroll is good in some ways, bad in others. "Obviously, she's the most trustworthy person I have in the office," Oxenhorn says. "The cons are that I can't push her, and she can't really work that hard."

Oxenhorn is not the only entrepreneur who has or will have a parent working for him or her. Seventy-nine percent of baby boomers plan to continue working during their retirement years, according to a 2003 study conducted by the AARP. One option some retirees will take is to join a company run by one or more of their children.

Family Matters

An entrepreneur who hires a parent is often looking to tap the older person's skills and expertise. "They're usually being brought in for some specific competency they have," says Andrew D. Keyt, executive director of the Family Business Center at Loyola University Chicago. Frequently, however, a parent who has retired from a working career is looking for something new and different, which can lead to frustration on both sides.

Adam Kohn, vice chair of Cleveland executive search firm Christian & Timbers, says it's more common for the job to be seen as something primarily intended to help the parent, either by providing income or by giving a retiree something useful to do.

Either way, it's important to treat a parent employee like any other employee. Be sure to have a complete job description outlining what you want the parent to do, and don't expect parental employees to come cheap. Experts say it would be a mistake to pay parents any less--or more--than the market rate.

Also, don't forget to include an exit strategy. Specify under what circumstances the parent's employment will end. While it may be easier to hope that such an emotionally charged eventuality won't occur than to talk about it, a little planning can save a lot of pain. "I have a couple of situations I know of [where the entrepreneur] would like to get rid of the parent, and it's difficult," Kohn says.

Understandably, employees may be confused about the presence of their employer's parent. Reactions can range from assuming that the older person is really the one in charge to being afraid to correct an entrepreneur's parent when he or she makes a mistake. Much depends on how the entrepreneur treats the parent and how the parent treats other employees.

Even when parents are employed under clearly understood terms, paid market rate and treated like any other employee, it's pointless to pretend they are just like other workers. The big issues here are emotional. "You need to assess how well you get along with your parents," Keyt says. "It's a recipe for disaster if you have really domineering parents."

Hiring your mother or father, however, can strengthen good parent-child relationships. "It's a great thing for people to be able to work with their relatives," Oxenhorn says. "You get to see them a lot more, which is great."

MARK HENRICKS writes on business and technology for leading publications and is author of Not Just a Living.