Here's a link to a recent article for American Express on dealing with the personal problems of employees
with my quoted input:
Karen Walker, president and CEO of consulting firm ONETEAM in Shelburne, Vermont, . . . adds that your degree of involvement should hinge on whether the personal problem is affecting the employee on the job. "If it isn't," Walker says, "it shouldn't be followed up on beyond what you feel is appropriate from a personal, empathetic relationship standpoint." If it's affecting their job performance, however, you should have a conversation with them early on.
Why early? Because saying nothing or very little and then waiting for them to fix the problem on their own may seem like a thoughtful gesture, Walker explains, but it actually isn't. If you wait and only step in after the employee has completely fallen apart on the job—when firing them is your only recourse—then you've helped to create "a situation that seems heartless," Walker says. "At this point, the employee has a personal problem and now a professional one as well."