During these tough economic times, many employers are lending a hand to struggling family members or friends by offering them employment opportunities. Ordinarily, in the private sector, nepotism (favoritism directed exclusively or mainly toward friends or relatives regardless of merit) is not illegal, and therefore, nobody has a cause of action against an employer for engaging in it. There are limited circumstances, however, where engaging in nepotism can land an employer in trouble.
First, if an employer hires friends or relatives to the point where they fail to consider people of other races, creeds, sexes, or ages, they may be violating Title VII of the Civil Rights Act of 1964 by discriminating against these groups in regard to hiring.
Secondly, if an employer creates workplace conditions that effectively force out an existing employee to make room to hire a relative, the employer may be liable, and therefore, must pay damages to the forced out employee.
If you any questions as to the legal implications of hiring a friend or relative, please contact an employment law attorney.