55. Managing Workplace Favouritism
How to ensure fair treatment and prevent resentment.
Imagine this - An employee who consistently outperforms their colleagues is overlooked for a promotion, while a less-qualified individual, who happens to be the manager’s friend or relative, gets the role. Meanwhile, employees start noticing that certain team members receive better projects, more leniency, or special treatment. Over time, these patterns emerge -
Hardworking employees feel undervalued and disengaged.
Team resentment builds, leading to workplace conflicts.
Talented employees leave for companies with fairer advancement opportunities.
The company’s reputation suffers, making it harder to attract top talent.
Nepotism (favouring family or close connections in hiring or promotions) and favouritism (unfairly privileging certain employees over others) erode workplace trust and damage team cohesion. If left unchecked, it can create a toxic culture, reduce productivity, and even lead to legal risks if discrimination claims arise.
HR psychology tells us that employees need to feel that promotions, rewards, and opportunities are based on merit rather than personal connections. When favouritism dominates decision-making, employees become demotivated, lose trust in leadership, and disengage from their work.
The challenge? How do you eliminate nepotism and favouritism while ensuring a workplace culture built on fairness, transparency, and merit?
The Solution – A Three-Part Approach - Identify, Address, and Prevent
Managing favouritism and nepotism requires recognising unfair treatment, implementing corrective measures, and fostering a merit-based culture. Here’s how to ensure equal opportunities for all employees.
1. Identify the Signs of Nepotism and Favouritism in the Workplace
Since favouritism is often subtle, leaders must actively assess workplace practices to ensure fairness.
A. Recognise Common Signs of Favouritism and Nepotism
Unqualified employees being promoted over more capable peers.
Certain employees receiving better assignments or more visibility.
Managers overlooking mistakes for favoured employees while penalising others.
Friends and relatives of leadership receiving preferential treatment in hiring or raises.
Key decisions being made based on relationships rather than performance.
Red Flag - If performance reviews, promotions, and salary increases consistently favour a select group of employees without clear justification, bias may be at play.
B. Understand the Impact of Nepotism on Workplace Culture
When employees feel that success is based on personal connections rather than hard work, it leads to -
Reduced motivation and lower productivity.
Distrust in leadership and company policies.
Higher employee turnover as talented individuals leave for fairer opportunities.
Legal risks if favouritism disproportionately affects certain groups.
HR Psychology Insight - Employees who perceive unfair treatment disengage from work, leading to lower innovation, creativity, and collaboration.
C. Encourage Employees to Speak Up About Unfair Treatment
Create anonymous reporting channels for favouritism concerns.
Encourage HR and leadership to actively listen to employee complaints.
Ensure employees who report concerns are protected from retaliation.
Red Flag - If employees are afraid to raise concerns about favouritism, workplace culture may already be toxic or deeply biased.
2. Address Favouritism and Nepotism with Fair and Transparent Policies
Once favouritism is identified, HR and leadership must take corrective action to restore fairness.
A. Implement Merit-Based Hiring and Promotion Processes
Use structured interviews with standardised questions to reduce bias.
Require clear, documented criteria for promotions and pay raises.
Ensure hiring panels include diverse decision-makers to prevent favouritism.
HR Best Practice - Companies that implement structured, merit-based hiring processes experience stronger workplace trust and better employee retention.
B. Hold Leaders Accountable for Fair Decision-Making
Require managers to justify hiring and promotion decisions with objective data.
Ensure all leaders undergo bias training to recognise and prevent favouritism.
Regularly audit leadership decisions to ensure consistency and fairness.
Red Flag - If certain managers consistently promote or reward employees from their personal circles, leadership accountability is lacking.
C. Foster a Performance-Based Recognition System
Base promotions, bonuses, and raises on measurable performance, not personal relationships.
Use peer reviews or 360-degree feedback to provide diverse perspectives on employee contributions.
Encourage mentorship and sponsorship programs that are open to all employees.
HR Psychology Insight - Employees who see clear pathways for career advancement based on merit are more engaged, committed, and productive.
3. Prevent Future Nepotism and Favouritism Through Cultural and Policy Changes
To maintain long-term fairness and transparency, companies must embed anti-favouritism policies into their leadership culture.
A. Promote an Inclusive and Equitable Workplace Culture
Encourage diverse leadership teams to prevent one-sided decision-making.
Create opportunities for employees from all backgrounds to network and grow.
Ensure leadership regularly communicates its commitment to fairness.
Red Flag - If employees feel that promotions and recognition are based on "who you know" rather than "what you do," workplace inclusion efforts are failing.
B. Establish Clear Anti-Nepotism and Favouritism Policies
Define policies that restrict hiring or promoting close relatives without transparent vetting.
Require disclosure of personal relationships in the hiring or performance evaluation process.
Set clear conflict-of-interest guidelines for managers and decision-makers.
HR Best Practice - Companies with formal anti-nepotism policies experience fewer workplace disputes and higher employee trust in leadership.
C. Regularly Audit Workplace Equity and Employee Perceptions
Conduct regular surveys to assess employee perceptions of fairness.
Monitor pay equity data to ensure no group is disproportionately favoured.
Use external HR consultants to audit hiring, promotion, and salary trends.
Red Flag - If workplace surveys consistently reveal concerns about fairness or favouritism, deeper structural changes are necessary.
Reflective Scenario – What Would You Do?
A hardworking employee has been with the company for five years but is consistently passed over for promotions. Meanwhile, the manager’s close friend, who has less experience, is given leadership opportunities and higher pay. The employee feels demotivated and is considering leaving.
Using the strategies above, you might -
Review promotion and pay data to identify patterns of favouritism.
Require managers to justify advancement decisions with clear performance metrics.
Encourage open feedback and create anonymous reporting channels.
Implement structured, unbiased evaluation processes for career growth.
By eliminating favouritism and ensuring opportunities are based on skill and performance, companies create a stronger, fairer, and more engaged workforce.
Golden Nugget - "A company’s greatest asset is its people—when fairness and meritocracy drive decisions, everyone benefits."
By identifying favouritism, enforcing fair policies, and fostering a transparent culture, SME leaders can build a workplace where all employees feel valued, respected, and motivated to succeed.