I used to work for a local/small company that had a policy in place that they would not hire relatives of employees. The head of HR would send out emails every time they hired someone new. One day an email comes out that they hired a new guy, and it said right in the email, that he was my cousin. Now, it was surprising to me because I did not even know that he had applied. There was a huge outcry about it, so much so, that they had to write up a new policy that only direct relatives (siblings, parents, spouses, children) could not be hired, but more distant relatives could.
But if you were a related to the owners that was ok.