Employee referral programs are an easy way to engage reputable candidates through your current workers. To help you run an effective employee referral program, we asked HR managers and business leaders to give us their best advice. From using dedicated software to publicly recognize employees, there are a number of ways that can guide you in putting the right elements in place to have a successful employee referral program.
Rely on a Dedicated Referral Software or Platform
It’s best to use referral software to make the employee referral process smooth and efficient. With the right software, your referral process will be straightforward and simple to use, thereby encouraging referrers to participate in the program.
Moreover, these tools can make it easier for recruiters to send out requests for referrals, at scale, for each position. The software also makes it much easier for the employees to share the links to open positions across their social and/or professional networks.
Make sure that the referral software you choose can integrate with your applicant tracking system to help create a more efficient talent pipeline.
Owner, Quick Cash Homebuyers
Be Specific With Who Gets Paid for the Referral
A well-defined and properly leveraged employee referral program can be an incredible advantage in identifying new talent and growing healthy cultures.
The most critical element is to remove any ambiguity about who gets paid for the referral. This may seem obvious, but so many organizations get this wrong, and it creates incredible confusion and a very poor experience.
The candidate should identify the name of the individual who referred them and then capture this information on the application. Other forms of referrals, for example, when employees provide names of potential referrals, can get sticky.
Inevitably, you are going to run into conflict over more than one person referring the same candidate, and then how do you choose who receives the referral bonus? By capturing this on the application within the ATS, it is date and time stamped and there is no room for doubt.
Founder and CEO, The Business of HR
Use a Referee Status Field to Keep Employees Updated
There are fewer ways to tank employee willingness to use a referral program than making it so that they’re tossing candidate profiles into the void, hoping that they’ve been hired and that they will have some sort of financial compensation in 3-6 months if they stay on.
I recommend including a referee status field in your employee referral programs, where referrers can check whether the person they referred is still being considered, what stage of the interview process they are at, whether they’ve been hired and when any rewards will be realized for the referral.
Try Creative Ways to Reward Successful Referrals
Mix it up! There are other ways to reward employees besides referral bonuses, especially if you’re just starting up and can’t afford to award a large amount of cash.
Offering paid vacation days is a great motivator. Even more creative offerings such as donating money to their favorite charity can give them the needed push to drop off a friend’s resumé. A gift card to redecorate their workspace, a subscription to a fun app like Spotify or getting to go to lunch with the boss can all be ways to inspire referrals.
Mixing up the referral rewards encourages employee engagement in the process while still getting significant benefits besides a flat rate.
Founder and CEO, Spicewell
Communicate Clear Expectations With All Parties
Employee referral programs are an excellent way to bring new employees into the fold. They are a great way to spread the word about your company and provide an opportunity for you to build a relationship with a potential employee before they ever come in for an interview.
One of the best practices for employee referral programs is to make sure that your employees know exactly what will happen if they refer someone who doesn’t work out.
It’s important that both parties are clear on what the expectations are, and how long it’s going to take before you can tell if a candidate is moving forward. If there’s no real clarity around these things, then it’ll be easy for both parties involved to take offense if things don’t go according to plan—and nobody wants that!
Content Writer, Love & Lavender
Treat All Positions the Same Regarding Incentives
One employee referral program’s best practice is to treat all positions the same.
We have a weekly email that is sent out to all employees and lists all of our open positions for employees to refer their friends to. With all positions, the incentive is the same unless it is for a part-time position. This means that no one will feel like they’ve been shorted if another employee made more money than them for a referral.
HR Professional, Sporting Smiles
The vast majority of employee referral programs function in largely the same way, with referrers sending in profiles and then getting a one-time payout following their referee completing either 3 months or 6 months at the company.
While this tried-and-true formula works fine, it delays gratification and can lead to people just blasting out referrals left, right, and center in the hopes of a payday down the line.
My recommendation is to make the rewards for referring a candidate two-tiered: a monetary reward after a few months of employment combined with a more immediate kick-back once you hire the person in question.
This can be a paid half-day, or a gift voucher—doesn’t matter what it is, so long as it’s quite small and available immediately to help the process not feel quite so remote.
Make the Referral Process Simple for Employees
For employee referral programs, some companies make it such a hassle for their team that they’d rather not waste their time and effort referring a friend or previous co-worker.
In order to maximize engagement, it is best to make it super easy for an employee to use the referral program by simply clicking a button, uploading a resume, or writing a short sentence. The more complicated the process is, the more it will affect an employee’s willingness to go through it.
Chief Product Officer, Checkr
Recognize Employees Publicly for Providing Referrals
Because employee referrals are so valuable, it’s important for businesses to recognize employees for providing them.
While employee recognition processes and technology have become commonplace, many businesses don’t realize that they can leverage these same existing capabilities to reinforce specific behaviors like employee referrals.
Publicly recognizing your employees for providing referrals is the most powerful way to reinforce this behavior because it encourages previous referrers to continue, and it shows other team members that positive recognition follows helping the company grow quality staff.
Director of Growth, Kudos, Inc.