If the relationship is known and you must work around it, ask the couple to draw up a contract with you regarding how you all will handle the problems that could potentially occur as a result of this new relationship. Tell them that you are happy for them, but that you have some natural concerns about productivity, both now and in the future if the relationship should end. Ask them for some voluntary commitments regarding how they will work together so that the relationship is not a distraction to others and themselves. Give them a week to get back to you with their list of commitments. Most employees will be harder on themselves than you would be. This removes you from being the Grinch who is not in favor of true love.
When the couple presents their commitments, consider adding any of your own that do not infringe on either employee’s rights.

• Do nothing. Doing nothing may be the very best option here. After all, many people have met and fallen in love at work. If the couple is not violating a written policy, you may have the option of waiting this one out. The romance could fizzle away quietly, or the couple could turn out to be one of those rare ones who can work and play together to neither career’s detriment.

When relationships do end and a manager must deal with collateral damage, the first step is to open up communication with each partner privately. Meet with each person separately and ask for his or her wish list for how work and communication should be handled during the adjustment period just after the break-up. Express your desire to handle this difficult time sensitively, but with the least amount of negative impact on the work environment and productivity. Do not offer the employee any assurances that all these wishes will be granted, but ask if there is anything the worker might suggest that would make work go more smoothly and productively for a while. Since you may be dealing with people who are in an emotional state, some of these requests may be unrealistic. After the employees present their requests, respond first by telling them what you can do. Follow this with a kind and objective account of what you will not be able to do. Above all, do not show that you favor or sympathize with one employee over the
other. Then revisit the previous options in light of the changed ircumstances.

• Offer company assistance to employees who need and want it.
Counseling paid for by health insurance, Employee Assistance
Programs, and even company chaplains offer relief to employees
who are truly suffering from the loss of a relationship.

Taken From: 201 Ways to Turn Any Employee Into a STAR Performer