The company wants to avoid three things:
- Appearance of abuse of power
- Conflicts of interest
- Problems unrelated to work
Abuse of Power
Alice is a manager and Bob works beneath him. When it comes review time, Alice gives Bob a much larger raise than the other employees due to his work. If it is because Bob is Alice's husband, that is a problem. Even if it isn't, other employees may believe it is which will hurt morale.
On the flip side, Bob may be a great performer but Alice feels uncomfortable giving him an appropriate raise because it would look bad to the other employees. The company suffers because Bob is less satisfied with his job.
Even if Alice and Bob are working in separate departments at the same level, preventing a conflict in the future reduces the flexibility of the employer to assign the best people to the right positions if they want to avoid a situation where there could be the appearance of abuse of power.
Conflicts of Interest
Bob's boss just found a problem with the project that will cause serious losses for the company. Bob is assigned to find the cause of the problem. Bob knows that it was Alice who caused the problem, but is worried that if he tells his boss Alice may get fired. On one hand he wants to do a good job, but on the other hand he is worried about how they will make ends meet if Alice loses her job.
Perhaps Bob is a safety auditor who lets Alice know when the next safety audit will be on her department so she can sweep problems under the rug. Maybe Alice is in accounting and overlooks improperly filed expense reports because she trusts Bob meant nothing wrong. Companies would prefer to avoid situations where someone's motivations may get in the way of them doing the right thing.
Problems Unrelated to Work
Alice and Bob are the two key members of a project. Their child Chris is diagnosed with a terminal illness and is given two months to live. Both decide to take leave to spend that time with their child. Alternatively, they both go on a vacation together and have an unfortunate scuba accident killing them both. Or they go through a divorce and Bob files a restraining order against Alice making work together difficult impossible.
While work is a big part of life, so is family. If family members are working together, there is more chance that problems from one will bleed in to another, and they will become worse employees for it.
Not Limited to Family
Not only are these restrictions in place for family members, there are often workplace guidelines preventing employees from having relationships with each other for the same reasons.
Employers understand that not all family members will cause trouble, but if you are looking for rather painless ways to reduce risk in your company, preventing relationships and family members from working together is an easy choice to make.