How to Run Successful Employee Referral Programs

Employee referral programs can be beneficial for hiring qualified talent. This is especially important when job openings significantly outnumber job seekers.

People tend to spend time with others who are like them. This means your best employees likely know other talented workers who would blend with your culture and succeed in a role.

As a result, you should focus on your employee referral programs to fill your open positions. The following tips can help.

Use these guidelines to effectively run your employee referral programs.

Market Your Program

Continuously advertise your employee referral programs. This encourages employees to participate on an ongoing basis.

Offer Incentives

Most employees prefer a cash bonus over other types of referral incentives. You may want to provide this reward when a referral remains with your company for a set amount of time.

Ensure equality in the award so an executive-level role does not provide a substantially higher reward than a lower-level role. This shows the importance of filling positions at all levels.

Clarify the Job Requirements

Provide employees with links to job descriptions for the roles you need to fill. This is especially helpful for employees who may provide referrals for other departments and job functions.

Share what you are NOT looking for as well. This minimizes the number of employee referrals who either are unqualified or do not blend with your company culture.

Maintain Communication

Ensure an HR member regularly updates each referring employee and candidate about the job status. This communication encourages employees to continue to provide qualified referrals for open positions.

Express appreciation for every employee referral. This encourages employees to remain active in the referral process.

Involve senior leadership in the creation and implementation of your employee referral programs. Promoting buy-in encourages senior leaders to be program champions.

Provide senior leadership with ongoing feedback and data on the success of your employee referral programs. Ensure the leaders understand the competition for top talent and the need to leverage employee networks.

Monitor Outcomes

Implement metrics to determine the success of your employee referral programs. These measurements show which parts of the program are effective and which parts need improvement.

Common metrics include the following:

  • Rate of employee participation
  • Number of qualified candidates gained through referrals as compared to other sources
  • Number of employees hired through referrals as compared to other methods
  • Performance of referred hires as compared to other hires
  • Retention rate of referred hires as compared to other hires

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