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What To Do With An Alcoholic Business Partner

Question:  We have recently discovered that our business partner is an alcoholic.  He is integral to our business and we need to find him help.  He’s been to a couple of AA meetings, but doesn’t like the “atmosphere.”  Any recommendations?  I don’t expect you to provide recommendations for treatment facilities. However I am interested in knowing how an entrepreneur should handle a situation in which s/he feels that in the best interests of the company, a key partner/executive/investor should exit or transition into another role for whatever reason. What evaluation process should the entrepreneur go through before making a final decision? How do you recommend the entrepreneur approach that person and with what type of exit or transition strategy?


Our Take:  This is a very unfortunate and sensitive matter.  Besides the personal issues, there are also business and legal considerations to address and we can not urge you strongly enough to speak to your lawyer, as state law can drastically change your options.  Normally, either Brad or I answer questions posed to us, but for this post, both of us will respond, Brad highlighting the business side and Jason addressing the legal.


Brad’s Take: I am no expert on alcoholism.  However, I have had several friends that either became alcoholics or drug addicts.  In each case, their addiction dramatically decreased their ability to function in a business context over a period of time until it reached a point where they had a meaningful negative impact on the business they were involved in.  These were both tragic situations – there were deep personal relationships that were shattered as a result of the stress, tension, and dynamics of the relationships around the addiction.  As a result I only know one way to deal with this in a business context – head on and directly.  As a human, I believe I am responsible for my actions and you are responsible for your actions.  All actions have implications and part of being a person, being business partners, and being friends is that you have to deal with the implications of your respective actions.  While your personal philosophy may be different than mine, I felt the only way to answer this question from a business perspective was to start with my philosophical frame of reference.


If you share my perspective, I’d recommend having a direct and very difficult conversation with your partner.  I’d do it in a non-confrontational manner – in a comfortable setting – with the backdrop of your fundamental concerns. In this case, it appears that your partner acknowledges his addiction, which is a great start.  I’d offer any and all help I could – and be as flexible as possible – within the context of reasonableness – to help him find help.  If AA doesn’t work for him, I’d help him find alternative programs, including such things as therapy and in-patient treatment for addictions.  But I’d insist that he address the issue as a part of staying involved with the business.  If he was unwilling to do this and his addiction impaired his ability to be effective, I’d immediately confront the issue of him departing the business if he was unwilling to address the issue and get help.  I would not be judgemental in any way – in fact I’d acknowledge that I wanted to do everything in my power to be supportive and helpful – but insist on dealing with it in the context of the business.  In my experience, one of the most challenging things for someone that has an addiction to deal with are limits on their behavior, especially in the context of the addiction.  While it sucks to have to be the person that draws the lines in the sand in a situation like this, it’s often necessary.


Jason’s Take:  I agree with everything that Brad has said. Unfortunately, if things don’t work out, you may have to consider firing your partner. Depending on where your business resides, you may or may not be able to terminate someone with a substance abuse problem.  In some states, you have to allow the person to seek treatment for 30-90 days and hold their position open while they are gone.  In the case of a key employee, it can be really tough on a young business to have this person absent from the company and to not have the option to replace them.  Even after this treatment period, you then have to give them some reasonable time to re-integrate into the business.  If you terminate the individual following treatment, one must always be aware of the potential “retaliatory firing” lawsuit.  This is a state-by-state analysis.  In some states, you can still fire a person for any reason.


Do note however, that a person with a substance abuse problem can waive their right to seek treatment and instead accept the termination and sign a release.  Obviously, there will be a price tag attached to this.
As for an “evaluation process” I’d suggest one of two polar opposites:  document everything, have multiple people in each conversation, put the person on notice, offer assistance, etc., or document nothing.   The “everything” approach will build the best record and in the event of a lawsuit, hopefully you can prove that you jumped through all the hoops and that the termination wasn’t an unjust termination.  The “nothing” approach is more akin to sweeping things under the rug.  This would play well if you think you can get a signed release at a reasonable price.

January 25th, 2007 by     Categories: Exits    
  • Dave Carlson

    Very practical, well-thought-out, and helpful answers. One of the key things is that alcoholism tends to exist within a system, with each part somehow reinforcing or facilitating the addiction. This is tough because you can only do so much from a business perspective, but if you’re interested in retaining him, it may be useful to find out whether certain tasks, decisions, or aspects of the work environment tend to create stress or otherwise contribute to the habit.

    • NoTimeforWasters

      Get a lawyer and have a court deem him as incompetent. There are provisions under company law to deal with a partner being incapacitated. Wayward on the drink is incapacitated. His drink problem is not your drink problem. If a partner is a drunk, dissolve the partnership.

  • http://scottsphotolife.blogspot.com/ Scott Converse

    I don’t know much about the legal aspects, but from a personal side, one of the best things a person can do in this situation is to find someone who’s got the same problem and seems to have found a solution to addressing it. AA meetings, for a newcomer, suck. You’re positive that everyone in the room is looking at you (they aren’t), that you’re a loser, that life bites and there’s no way you belong here; no one, after all, says ‘I wanna be an alcoholic when I grow up!’.
    About one out of ten people has an addiction problem. No kidding. If your company has 12 people in it, you have at least one drunk, pretty much guaranteed. Drugs and alcohol are by far the most prevalent addiction, so, I’d suggest finding someone who’s a recovering alcoholic or drug addict (nowadays, it’s usually both) and have them help the person through the initial discomfort of getting plugged into a support network like AA or NA. Part of the getting straight or sober process is helping other people get straight or sober, it’s a powerfully symbiotic and beneficial for both parties process. One thing is for sure, if you’ve got an active drunk in your business and they’re in a key position, it’s just a matter of time before some level of chaos (from minor to very major) ensues. As Brad says, address it now, it’s not going to go away.
    Believe me, I know. I’ve been in AA for 25 years.

  • http://www.doitsober.com/ doitsober

    There is solid insight/good info for business owners on this topic in the book Alcoholics Anonymous. Read the chapter “To Employers” for suggestions on how to have the needed talk Brad suggests here. Good luck.

  • Cj31960

    So hard…my husband is a partner with my brother in business.  My husband is doing more work to compensate for what my brother isn’t doing.  I’m afraid they are on the titanic and it’s too bad because otherwise they would be very successful.  My husband has built an amazing reputation and is sought after for his work.  He’s tried talking to him in a kind way several times, been frank on finances, told him employees are unhappy about it…nothing works.  He has 1% more ownership than my husband and so my husband feels his hands are tied, that there is no way out, and that he will have to sink with the ship this winter, which will probably put us out of our home.  I try pushing to help and it makes things worse.  My father died of alcoholism.  I know from many years of this – they can only change themselves and they usually have to hit the absolute bottom of complete loss financially and emotionally just to get a small desire to change.  It’s a selfish disease and it kills a lot of people.  Certainly waiting and hoping for change never works.  I think you have to cut your losses, if you are lucky enough to be able to do that, before you go down together. Thanks to all who contributed here, it was helpful for my husband to read.  Take care.

  • momdb50

    i have a business partner that at first I thought it was her health that was causing her problems with many aspects of the business. Then I went to pick her up for a job and she was clearly still a bit drunk from the night before. When we got to our clients house she fell up the steps yikes. She said it was due to her leg giving out. But she is always saying her back hurts, her stomach is upset and coughs a lot to the point of gagging. She blames her upset stomach on colitis all the time. I know this is due to her consuming a lot of alcohol. She has on several occasions when and bought vodka after work. She made statement like I am out of vodka and the state stores will be closed tomorrow etc… etc… I want to talk to her about it but afraid it will ruin our business partnership. What should I do? She gets the shacks and blames it on her inhaler. She does have an inhaler but she does not use it that much. I know the signs of alcohol abuse. She did say she hides her vodka from her daughter and grand children.