How To Develop And Implement an Employee Referral Programme (Guide + Sample)

2024-06-16 22:04

As a Human Resources professional, you’re probably already aware of the benefits that come with utilizing an employee referral program. Not only does it save time and money by streamlining recruitment efforts, but when done right, it can also drastically improve the quality of your new hires. According to LinkedIn Talent Solutions, it takes, on average, 29 days to hire a candidate referred by an employee. Additionally, employee referral programs can lower your cost to hire and improve retention rates.

An employee referral program is a Human Resources strategy that encourages employees to refer qualified individuals they know for open positions within the company.

Company referral programs work by offering incentives to employees when their suggested candidates are successfully hired. The rewards often increase based on the referred employee’s tenure at the company. This type of referral system ensures that employees are motivated to recommend top-notch candidates rather than just friends or family members looking for jobs.

Employees can make internal referrals by recommending individuals who are already working at the company for a specific role. Alternatively, they can refer candidates who are not currently employed by the organization but would be a good fit for the position.

How to design and implement an employee referral program

To design and implement an effective employee referral program, follow these steps:

Step 1: Define the program’s goals

Clearly establish what you aim to achieve through the program. Will it focus on collecting referrals for various roles or specific positions? Having a clear endgame enhances communication of the program’s vision.

Step 2: Determine the program’s structure

Employee referral programs can range from informal gatherings to dedicated internal platforms for submission and tracking. Choose a format that suits your company’s needs best.

Step 3: Create enticing incentives for employees

Once the program’s workings and objectives are defined, consider what would motivate employees to participate. Options include cash bonuses, special meals, extra vacation time, company gear, or even unique experiences paid for by the company. It’s also worth considering a tiered reward structure based on employee tenure.

Step 4: Develop the necessary program forms

Translate your program into action by creating a dedicated site, drafting email templates, scheduling meetings, or any other means required to bring your program to life.

Step 5: Formalize the process to minimize bias

Employee referral programs can inadvertently introduce biases during the hiring process. Take the time to carefully review and ensure the entire process is fair and impartial.

Step 6: Communicate the program to all employees

It is vital that employees are aware of the program’s existence for it to be effective. Consider integrating it into the onboarding process or other company-wide communications.

Step 7: Continuously promote the program to the workforce

Regularly remind employees about the program’s availability and benefits. Find creative ways to ensure that information about the program is regularly and consistently conveyed.

Step 8: Establish methods to track the program’s effectiveness

As with any project, monitoring progress and value is crucial. Determine how you will measure the program’s success and identify areas where adjustments may be necessary.

👉🏻 Sample employee referral program

Here are some recommendations to enhance your employee referral program:

Establish a comprehensive employee referral program policy

Having a well-defined structure in place strengthens the effectiveness of the program. When both recruiters and referrers have clear guidelines to follow, the desired outcomes can be achieved consistently.

Leverage recruiting software

While an employee referral program relies on human connections, utilizing online tools can streamline the process. These platforms enable better applicant tracking and facilitate communication with all parties involved.

Provide training on best referral practices

Engaging employees is crucial for the program’s success. Regular seminars can create awareness about the program and educate employees on the type of individuals they should recommend to the company.

Emphasize diversity and inclusion

A diverse workplace fosters strength and innovation.

Monitor and evaluate results

To ensure the program’s effectiveness, closely monitor its outcomes. Tracking the progress and success of referred employees can provide valuable insights and help identify areas for improvement.

Employee referral programs are an excellent way of attracting top applicants for a role. Research shows that referred employees tend to be more qualified, stay longer at a job, and be better culture fits.
By giving workers rewards for recommending the best people they know for the role, you inspire them to participate in the process to the best of their ability.

Developing a referral program is one of the areas covered in the Managing a Recruiting Team course.

🎁 I invite you to the online course Managing the Recruiting Team and you will get a full set of modern recruiting tools, using which you will be able to create your own winning team! The link to learn the program has been given to you.

See you on the course 😉