Can You and Your Spouse Divorce and Still Run a Business Together?
What happens when a couple decides to divorce and they own a business together? Typically, one party buys the other party out of the business and the bought out party leaves the business immediately, or they stay on as an employee for a short period of time while they transition to new employment and/or new employees can be trained to take over the bought out spouse’s role in the business. However, can a couple continue to run a business even though they are no longer husband and wife? Some would say, no, one party should step aside. Bryan Borzykowski, in his article “When Couples Divorce But Still Run the Business Together” published in the New York Times New York edition and on NewYorkTimes.com, suggests it can be done, but not without effort from both parties.
You may be wondering how can you continue to run a business with someone you are divorcing? Not everyone’s situation will allow for a continued business relationship even though their personal relationship has failed. But, if you are considering continuing your business relationship there are a few issues that must be addressed.
First, you must have respect for one another. Without mutual respect, the business relationship will not succeed. Even if you are angry with your spouse you can make the business relationship work if you have trust and respect.
Second, it is important to communicate clearly and do what you each agree to do for the business. A therapist can assist in working out problems when communication becomes difficult.
Third, sign a Business Agreement. Often, married business partners do not have a written shareholders agreement. It is essential to have an agreement that sets out the details of your business arrangement including what happens when one partner wants to leave or sell the business.
Finally, you must assure your employees that you both are committed to working together. Often times, employees take sides when a marriage disintegrates. If you are going to continue your business relationship and have it work, it is important to tell your employees together that although your marriage is ending, the business will continue as usual. Being upfront with your employees will alleviate rumors and reinforce job security.