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Philadelphia Skyline

Super-Nepotism -- Hiring Employees for a Coop

Michelle A. Maratto answered a reader's questions in The Cooperator, the Co-op & Condo Monthly on hiring building employees for a coop in the June 2010 edition.

Q A front desk position in my building is about to become available. Our board wants to hire the son of our current janitor. I am not in favor of hiring relatives and our bylaws state that in such an instance, the board must notify all owners. Our current president thinks that most of the staff is like family than building employees. Thus, they in turn tend to give him “extra” special services. This is why I would like to hire someone who is not part of the “family” to try bring some equality for the rest of the residents. Do you have any suggestions?

—Searching for Fairness

A “Speak up and try to dissuade your board from hiring the super’s son,” said Michelle Maratto, a partner at the New York-based lawyer. “One court put it this way: “While hiring relatives is not necessarily improper, basic common sense dictates that if you are going to do that, there should be full disclosure and meticulous record keeping.” In re Phillips, 20 Misc. 3d 1111(A) (Sup. Ct., Kings Cty. 2008), Phillips involved a guardian of an elderly, incompetent person. The guardian hired family to do work for the estate, but kept virtually no records.

“It sounds like your president is keen on the idea of hiring people who are like “family” to him. And it doesn’t sound like there are many records kept of all the extras he gets from such “family.” In any event, write your feelings down and circulate them to the other shareholders. Make a list of reasons why nepotism is a bad thing. Just a few examples: (1) It is in all our interests as shareholders that the building be run professionally. Nepotistic hiring practices are not professional. (2) We are giving too much power to one block of employees this way. The front-desk-son and the father-super could cover one another’s mistakes, etc. If there is a dispute between a shareholder and the front-desk-son, and the father-super is in any way involved, father-super will support the son’s position. I can hear Father-Super now saying, “No, I too, saw Ms. Smith pick up that package from Desk-Son! She must be mistaken that it went missing at the front desk!”  Read more...

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