Human Resources Blog - Spark Hire
Employee Referral Program

The Secrets To A Successful Employee Referral Program

Modern recruiting requires a multi-faceted approach. Hiring managers need to get more creative than ever before in order to land the eye of top-tier talent. If you’re hoping to find the perfect person for an available role, slapping a job post on your company’s website and kicking back and waiting for qualified applicants’ materials to roll in simply won’t work. Instead, you’re going to have to get resourceful about the process.

This is why many hiring managers are putting employee referral programs into place. They’re essentially enlisting their veteran employees to serve as both recruiters and brand ambassadors to assist in helping them land their next great hire.

So, what are the benefits of an employee referral program?

Employee referral programs have become a popular tool when it comes to recruiting. These programs offer benefits for both hiring manager and staff member. Here are just a few:

You get a better sense of who you’re interviewing

Blindly posting about a job opening and seeing who responds can get you plenty of resumes. The issue is you have no idea what you’ll get when you bring these individuals in to interview. They might look great on paper, but turn out to be not at all who you’re looking for to fill the open role.

When you rely more heavily on employee referrals, you can get information and some background about this individual in advance. What sorts of professional experience has this person had? In what kinds of situations do they thrive? Though you should go into each and every interview with an open mind, these essential details allow you to pre-screen and make sure the interviews you end up doing are worthwhile.

You know this individual will probably fit in

If a current staff member is referring this individual, you know they’re familiar with your business’s culture and policies. The fact that they have still opted to recommend this person shows that they feel confident this person would mesh well with your current employees and could contribute positively to the team.

Employees know their opinions matter

By putting an employee referral program into place, you’re demonstrating to your team that you take their opinions seriously. You trust their input and want to hear what they have to say. This is hugely important for company morale.

Once you’ve decided to put together an employee referral program for your business, getting the new initiative off the ground takes a carefully coordinated effort. Here are some key steps you can take to ensure that your new employee referral program is a success:

Start it off with a bang

Sending out a lackluster memo announcing the initiative and then hoping that people start throwing qualified leads your way simply isn’t enough. Instead, do something more dramatic to signify the beginning of the employee referral program.

You want to grab your current employees’ attention. Call your team together and announce that the first person who successfully provides a referral who stays with the company for X amount of time gets a specific reward. Perhaps this is a monetary reward, or you can also choose to dole out extra vacation time or work-from-home perks. Getting your team excited about the program is essential to its success, particularly in its early stages.

Get support from upper management

Getting upper management’s buy-in helps to ensure that your employee referral initiative will be a success. When your CEO, CFO, and other top brass believe in the importance of the program, they spread this belief to everyone else at the business.

If you can get top management to send out an email or a memo supporting the program, you have a powerful seal of approval that helps give the program longevity.

Make the incentive worth the effort

If you’re asking employees to act as spokespeople for your business as they recruit friends, family members, or former co-workers, you’ll need to reward them for their efforts.

If they successfully introduce a new hire to your business and that individual ends up sticking around, they should see some sort of benefit. This could be a monetary reward, extra vacation days, or other perks. While your employees may love their jobs and want the company to succeed, you can’t expect them to be out their recruiting without any incentives coming their way.

Be particular about which positions you recruit for

You want the program and the people participating in it to succeed. To help make this possible, you’ll need to be particular about the logistics of the initiative. It’s best to restrict the referral program to only certain positions within your company.

For example, you may want to keep the program open only when you’re hiring for new salespeople or HR professionals. When you have an open role with very specific requirements to fill (say your CFO leaves), you’ll want to do a more narrow and controlled search. Know where the program is likely to have success and restrict it to those areas.

Make successes known

In order to keep the momentum of the employee referral program going, make sure to publicize successes. If you send out a company newsletter, give special recognition to employees who have helped recruit new hires. Do an interview with the new team member, and during the discussion talk about how this individual was part of the employee referral program.

When staffers see that the program works and provides a real possibility for a reward for them, they’ll be more inspired to tap into their network and see if they know of anyone who might be a good fit.

Don’t make it mandatory

Your team has enough on their plates when it comes to daily assignments. They don’t want to feel as if they’ve automatically been assigned to act as recruiters, too. To keep them engaged in this new initiative, you’ll need to show them the benefits, but never make anyone feel pressured to participate.

When there’s mandatory participation involved, suddenly the quality of the leads you’ll get will decrease drastically, thus defeating the purpose of putting an employee referral program in place to begin with. People will just start throwing names your way to say they met their quota as quickly as possible. Those who take part should be doing so because they want to and because they genuinely have confidence in the individual they’re recommending for the job.

Offer rewards for effort

In order to prevent employees from getting discouraged, you might consider offering a bonus for someone who comes close to getting a referral hired, but doesn’t quite get there. Perhaps they get $100 for a first interview and $200 for a second interview.

You want people to feel inspired to keep tapping into their networks for qualified individuals. Showing them there’s value to participating even if the person ultimately doesn’t end up landing the job is an important way to do this. You might also want to consider giving an individual a small reward even if the hire only works out for a short period. This shows that you still value their effort and thought, even if the individual ultimately wasn’t a good fit long-term.   

Keep the referrer updated

When someone refers a friend or family member to your organization, they could be putting a relationship on the line as they blend their business and personal lives. They’re encouraging someone they care about to go for a job, knowing they might not get an offer.

To prevent any negative outcome as a result, it’s important to keep the employee doing the referring as informed as possible. Talk to them about how far their referral is in the process, and let them know what’s happening next. If they don’t get the job, be honest about this so the employee can focus on preserving their personal relationship.

You don’t want to have someone refer their sister, and then have to admit to her that they honestly have no idea why she hasn’t gotten a call back about the job they swore up and down she’d be perfect for. Protect your staff from winding up in this uncomfortable situation by keeping communication clear.

Make sure the process is straightforward

If your team members have to jump through hoops just to submit a name for the employee referral process, don’t be surprised when no one opts to submit potential referrals into the system. Your employees are busy trying to do the jobs they were hired to do well. They don’t have time for extra paperwork just to make it easier for you to find a new hire to fill that open role.

Instead, make your employee referral program as straightforward as possible in order to increase the amount of submissions you receive. Take the burden off of your staff members and you’ll find that they’re more eager to participate.  

Accept referrals year-round

Yes, you want as many employee referrals as possible when you have an open position to fill, but be open to them year-round. It’s always wise to have a database of qualified candidates. This way when a job does open up, you can immediately start contacting these individuals, instead of frantically firing off a job posting and scrambling to get someone in place in a timely fashion.

Coach employees on their referrals

If someone is continually referring less-than-qualified people, don’t automatically take their ability to participate in the program away. Instead, coach them on their choices. Explain what the business is looking for, and what kinds of people would do well in these roles. If they continue to make poor suggestions after this conversation, take a closer look at who they’re referring and identify why these people aren’t the best fit for the job.

Make sure company values and culture are clear to everyone

To help keep the quality of referrals high, make sure everyone in your office is aware of the business’s vision and values. Reminding your staff members about what you’re working toward and why is essential for morale and productivity purposes, but also so they continue to help you recruit the right kind of people. When they know the short- and long-term goals of the company, they have a better sense of who could help fulfill these goals.

Let people recruit outside of their departments

In order to keep your employee referral program a success, give your team members the chance to recruit outside of their departments. They know their own section of the business well, and therefore know the kinds of skills and personality a would-be staffer in this department should possess. However, you may be surprised to find that your accountant knows a highly qualified salesperson, or that your best seller knows someone who would be a terrific receptionist. Regardless of the employee’s department, let them recruit how they see fit. You never know who they may bring your way.

By tapping into your employees — the people who know the ins and outs of your business — to act as recruiters, you’re increasing your chances of finding qualified would-be new team members when you have an open position to fill. And by rewarding them for their efforts, you create a system that benefits your existing employees, while making it easier to recruit top tier talent without having to sort through those who simply wouldn’t be a good fit for your business. Putting together a highly structured and mutually beneficial employee referral program is an excellent way to staff your business and fill open spots efficiently.

Lauren Levine

Lauren Levine is a copywriter/blogger who contributes to a number of magazines and websites including The Frisky, USA Today, and others. She also authors her own blog called Life with Lauren. She loves cooking, anything on the E! network, and is trying to convince herself that running isn't so bad.