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In some instances yes it can be emotionally unhealthy.

From personal experience working with your father can be very difficult.
The reason I say this is because when it comes to getting paid, he feels, since your his child, that you can either "wait for payment" or not get any increases.
You also feel the ability to slack off and not work as hard as if you were working from someone not related. This also will interrupt any increases you had in mind.

I would not recommend working for your father unless you know he will pay you for what your worth.

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Q: Is working for your father emotionally unhealthy?
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