Just my gut reaction, but could she be in depression? The signs are all there.

Wow! That has DEPRESSION written all over it! Sounds to me like Tracy needs real help! It makes perfect sense given the fact that her husband ran up the debt then abandoned her, leaving her with the load of paying it off and providing for her child...may even be some resentment at having to do so. Still...the fact that she's such a wonderful employee and quite capable, yet seems unable to do the very basic things she needs to to succeed has al the earmarkings of someone so depressed she can barely pull herself out of bed in the morning and face the day. Once she does, she functions well. I don't think this is a discipline problem. She seriously needs mental help!

You need to sit down with her and confront her in regards to her feelings about her life and current situation she is in. (She will refuse to begin with but you will have to force the issue) 
 
I would find a professional who can help with depression and feelings of abandonment. 
(Make an arrangement that she needs to visit at least twice a week etc) 
 
The best thing you can do is pay for her sessions and give her a month off the job with pay. 
 
Might seem a little expensive but for the time being but this will let her focus on what she really wants and I am sure she will repay without question indirectly in sales. 
 
If she feels that she cannot work for you no longer than you will need to let her go, otherwise after having a few sessions with a physiologist will determine the issue that needs to be addressed before she can go on with her life and maybe even find a new potential partner as well and be back on her feet. 
 
In life even when we are at our worst just because we can function doesn’t mean that we are all really there. She is only in the job because of her child.  
 
You will need to make her feel grounded and loved again before she can move on with her life and enjoy working at your store. 
 
Just remember this is not usually the responsibility of an employer but if you value your friendship with this particular employee then it should be your obligation to help her and make things right. 
 

Having allowed a former spouse to abuse me financially I can relate to Tracy. I have two sons a single mom,widowed from my business partner and apprentice, now divorced from a very bad person (being kind). 
If you haven't already offer Tracy the GIA classes having a degree will boost her morale.

Daniel Pink's book "Drive" is all about motivation. He explains that most people need three things to truly be motivated to do their best - Autonomy, Mastery & Purpose.  
 
 
 
Although, I agree that depression is probably playing a role, one way to get out of depression is to have a purpose.  
 
 
 
If I was the business owner I would look at all three, especially purpose, and see if I could give more of that to Tracy.  
 
 
 
One suggestion is to have her champion a cause through the store, one that might be close to her situation like a cause for single mothers and find a way for her and the company to raise money for that cause. This will give her more of a sense of purpose and may motivate her to have better attendance.

She needs the Lord Jesus in her life - "Then would thy peace have been as a river...." (Isaiah 48:18)

You may want Tracy to be more responsible, but only Tracy can make that happen. You may not want to fire her, but allowing her to come as she pleases is only enabeling Tracy to continue this behavior, no matter what the reason behind it. You can't be both her friend and her employer, so you will have to choose which one you would rather be. If you choose to be her employeer, than purhaps a 30 day review should be set up, with your expectations clearly stated - including letting her go if those expectations are not met. After 30 days you would need to decide - does she stay or does she go. Sounds like tough love, but Tracy is an adult and so the choice is hers.

I believe K. Wooden's comment is on the mark but I would include in that 30 days some counseling as also expressed above. I think counseling should include her son too.

Regardless of the reasons, this behavior is not appropriate and establishing boundaries and limitations is up to the employer. This is true whether the employee is a top producer or not, and the employer must not use being a good producer as justification for not confronting the problems. Much has been said of the employee but the employer has not said much, specifically, about what SHE has done to correct this situation. Her comments about being friends with this woman might support my speculation that perhaps she has problems with understanding HER role as an employer in setting appropriate boundaries. I suspect that on some level, because of her feelings, and the fact that the employee is a top producer, she is hesitant to take proper authority. My recommendation is for the employer to work on her ability to be a more effective manager, specifically in understanding what the correct roles are between she and her employees.

It's obvious that the employee has some kind of handicapping emotional condition -- depression or otherwise. But I think your suggesting and financing her therapy violates the employer/employee boundary, also.  
 
Yes, she may have lost you one $5,000 sale. But weigh it against the unbelievable sales numbers she garners you. If you didn't have her, how many sales would you lose? 
 
Can you work around her limitations? For example, don't schedule her to open, only schedule appointments with her in the late afternoon, notify customers if she won't be in that day and reschedule them to another day or another salesperson (whatever works).  
 
I've had my share of unreliable employess -- and fired them. However, in this situation, firing her may cost you more in the long run than working around her shortcomings.  
 
Good luck to you...  
 

I have had employees like this in the past... one minute they are your biggest headache and the next they are blowing you away with brilliance! I have 2 suggestions that I have used in the past (both with moderate success). 
 
 
 
1) Give her more responsibility. She understands that what she is doing affects the business and when shown the errors she makes them right; she genuinely feels bad for her actions. By forcing her to be more responsible she might rise to the challenge. 
 
 
 
2) Take away all responsibility. If you don't need to rely on her for anything than you will rarely be disappointed. If she is never on the schedule she can never be late. If customers want to meet up with her, she is charge of her appointments which she won't miss because she set them. Of course when she is there she must follow the some code of conduct as the other staff but she would sell as more of an independent contractor. 
 
 
 
I don't disagree with the depression theory but I wouldn't blow it out of proportion. She is going through a tough time right now and one thing that can help is job security. This will not last forever but while it is going on you need to be the strong one in her life. Separate you personal feeling for her from the needs of the business so you can make rational decisions. It is ok to be empathetic but you are the boss and she needs you to be that for her right now. 
 

Sounds like a drinking or drug problem to me. Eunice needs to confront her and ask her why she is so unreliable. If she has an addiction or if it is depression, the employee needs to get help, but not at the employer's expense. I don't care how good of a sales person she is, she is being abusive to Eunice and the other employees. And one more thing, Eunice needs to emulate her and learn to sell, and so do all the other (14!) employees. It sounds like this flaky employee is passionate about jewelry and really gets into it. If the owner and others are not, maybe there is something else out there they should be doing.

Interesting comments. In the short term I believe Jared is right. The number the lady produces when she turns up sound great (I don't know how it compares to other sales staff or the store in general). I would make her supernumary,as she more than pays for herself when she does turn up, don't assign her to follow up or appointments. In other words treat her as an unreliable cash cow.  
 
In the long term friend and employer are difficult roles to manage in one relationship. Decide upon one or the other. If you elect to be her friend then help her but terminate your employment relationship. 
 
Staff!