Is Nepotism Illegal?

What is nepotism?  Nepotism happens when someone at work who has the power to hire, assign tasks, promote, discipline, etc. shows favoritism towards a relative.  For good reasons, a lot of people seem to think nepotism is illegal because it is unfair. 

Nevertheless, nepotism is not illegal in California for private companies.  It does not matter how annoying or unfair that may feel. 

On the other hand, nepotism is expressly illegal in all workplaces in the public sector under both California and federal law.  California law requires that all public workplaces affirmatively use a merit-based system for hiring, transfer, and promotion.  It also mandates having anti-nepotism policies in place.  The policies must include a definition and description of nepotism, and prohibit participation in the hiring process or supervision of someone where a personal relationship exists.  California defines personal relationship as persons related by adoption, blood, cohabitation, domestic partnership, or marriage.