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Creating an Employee Referral Program That Works

Employee referral programs can mobilize your workforce and help cut your recruiting costs, possibly even attract better candidates, and may even shorten the hiring cycle. Here's a closer look at five tips for creating an effective employee referral program.
Tips for creating an employee referral program.

An effective employee referral program can help you attract and retain highly qualified workers who are a good fit with your company's vision. However, simply putting a referral program in place without a clear strategy, objectives, or incentives is likely to yield limited results. Here are five considerations to help you create an employee referral program that works.

Hold 15-Minute Sourcing Jams

Sourcing jams are short meetings where recruiters can connect with existing employees to see if anyone in their network could be a good fit for open positions in the company. Consider holding these meetings in a casual environment – think coffee or a short walk. Make employees aware of your referral program, your top priority open positions, and ask if there's anyone they know who might be a good fit. Often, employees may not reach out about potential hires because they are busy or don't want to bother company recruiters. Taking a short, dedicated period of time to talk about your referral program can prompt your best employees to think of promising referrals and get them to follow up quickly. If your team doesn't have time to do this across the board, consider scheduling priority sessions with areas where you're hiring, such as meeting with your technology team to find developers.

Offer Incentives

Monetary incentives, bonus days off, and other incentives may help motivate employees to take part in your employee referral program. Many successful programs offer a bonus to both the referrer and the candidate. Others will pay out a bonus to both after a retention period of several months or one year. It helps ensure the quality of the hire, while helping employees see that there's a specific and personalized benefit to suggesting candidates for open roles. Incentives are often less expensive than job postings, paying outside search firms, and other costly recruiting techniques.

Create an Effective Employee Referral Toolkit

Successful employee referral programs often start with training your team. Teach them how to spot a good candidate, and offer them different strategies and templates for making that initial contact. For example, some HR departments will provide an email template that employees can use to share a job lead with professional contacts. Others will write short social media status updates that employees can share in their networks. Ensure that your job descriptions, career website, and other materials are well-crafted and that your best employees will be willing to share them on your behalf. A user-friendly process is more likely to lead to a successful referral program.

Promote Priority Positions

While a well-oiled employee referral program can lead to great candidates across the organization, consider focusing on priority positions. For example, if your company particularly needs developers or finance talent, consider showcasing these jobs. Mention them in your employee newsletter, highlight one position a week on your intranet, or mention specific jobs during employee meetings. Your team members may not have the time to comb through your careers website looking for open roles, but if they hear about an open position during their workday, they may make a connection between a job and someone they know.

Recognize and Engage Your Team

Many companies believe that a financial incentive is all that's needed to gain participation in an employee referral program. However, personal recognition may be even more effective. Mention people who have referred new hires during all-hands meetings or send flowers and a thank you note from your talent team. Periodically check in with your employees to make sure they are aware of the employee referral program and are on the lookout for the talent you're seeking most. Periodic check-ins from your recruiters can result in much higher levels of engagement.

Employee referral programs are popular for a number of reasons: they can lower the costs associated with recruiting, while possibly increasing the quality of the candidates that you see. However, a successful employee referral program requires the right tools, consistent engagement from your talent acquisition team, and strong levers in place to recognize participation.


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* This content is for educational purposes only, is not intended to provide specific legal advice, and should not be used as a substitute for the legal advice of a qualified attorney or other professional. The information may not reflect the most current legal developments, may be changed without notice and is not guaranteed to be complete, correct, or up-to-date.

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