Don't. Period.
You: "But, but, but..."
Me: "Okay, obviously you didn't hear me, so I'm going to spell it out for you: If you hired them, at some point you may have to fire them. And if they hired you, at some point they may have to fire you."
Think about that.
You: "Yes, but I know for a fact that they are a great worker." (Or, if you were the one hired by your friend, we'll assume that you're a great worker, or you wouldn't be reading this and trying to improve yourself.)
Me: "The best worker you could have chosen? Even when their best friend hires them?"
It doesn't mean that your friend is evil. It doesn't mean that, in other circumstances, they don't excel. But working with a friend is a distraction at best, and it's only a matter of time before one of you starts to let things slide.
Now let's go a layer deeper: Your friend does indeed turn out to be a great worker, the best, and when a juicy promotion or opportunity for a pay raise comes up, you give it to them, right? Right?
Not unless you're a fool. Here's why:
Everyone else sees it as cronyism. It doesn't matter how good your friend is (or how good you are, if your roles are reversed). Everyone else - even people not up for that pay raise or promotion - absolutely knows that the only reason that your friend got it is because they're your friend. And that will cause these other employees to leave, because who wants to work somewhere that you have to be friends with someone to get ahead, and where your work means nothing?
They won't even say anything about it - not to your face.
And if your friend gets wind of it, how do you think this kind of talk makes them feel? How do you not begin to question your own abilities when everyone else around you questions them, or just assumes that everything good that you do only happens because you're pals with the boss?
You're right - it's exactly like the sex-with-a-colleague scenario, and with exactly the same results. Eventually, the best that you can hope for is to lose a friend. At worst: litigation for unlawful discrimination.
So we end where we began: Want to hire a friend or family member? Don't. Period.
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