Creating an Effective Employee Referral Program
Employee referral programs can be a great asset and cut recruiting costs when used effectively. According to several employee referral program providers, employers who use employee referrals can reduce the time to hire by almost 50 percent compared to bringing in candidates through their company’s careers site.
Therefore, component manufacturers can create an extremely effective employee referral program for little to nothing by following these eight guidelines.
Best Practices
Keep It Simple
Your employee referral program should be simple to understand and easy for employees to find out about.
Cash Is Key!
If you want employees to refer people, offer them cash as an incentive. Across the board, all blogs, reviews, and websites about employee referral programs list this as the most effective incentive.
Small Reward for Referring
Reward employees with a small gift for every referral, even if the person doesn’t get hired. It can be something as small as a $5 dollar gift card to a fast food restaurant. A small token of appreciation will reinforce the behavior of making referrals and will encourage employees to continue to do so.
Communicate Your Program Effectively – in English and Spanish
Every person you hire should be made aware of your employee referral program during the onboarding process. Hanging bilingual posters about your employee referral program in common places like the lunchroom, bathrooms, and lobby will be a constant reminder. On that same note, don’t forget to use the power of social media. Almost three-quarters of American adults have a social media account, so sharing your referral program and open positions through social media for your employees to see, share, and refer their friends to your company’s posts will increase your chances of success.
Communicate Your Open Positions
Sending out companywide emails about open positions, posting open positions on your company’s website, sharing open positions through social media, and having managers address employees in their departments about open positions (with a reminder about the referral program of course) are all effective ways to ensure everyone is aware of the opportunities within your company.
Be Proactive
If you have open positions, ask for referrals regularly. Some say every day, but once a week is efficient. Again, utilize managers’ direct communication with employees, company-wide emails, and social media posts.
Feedback
If employees refer someone and never finds out what happened they will most likely stop referring people. The best way to handle this is by informing the employee that you appreciate their time, effort, and referral, but that the company has chosen to go with a different candidate. This is a good time to implement the small reward.
Set Goals for Your Program
Set a goal for what percentage of hires you would like to come from employee referrals. Constantly measure the results and refine your program to work better for your company.
Things to Think About for a Successful Employee Referral Program:
- Use Multiple Recruiting Methods
Use a variety of recruiting methods when advertising job openings in the organization. Make sure that all employees have access to know what positions are open. - Referral Employee Programs Must Be Open to All Employees
Keep the employee referral program open to the entire organization. Not limiting it to specific employee groups, departments, or divisions will ensure success and fairness. - Equal Evaluation
Evaluate all candidates equally using the same qualification criteria.
Additional Resources:
ROI for Employee Referral Programs:
- Improve Quality of Hire – Employees feel a sense of responsibility to refer good candidates because their performance could reflect back on them.
- Improve Company Culture – Employees are going to refer people who they like and get along with. If the current employee is a good fit, it is likely the person they are referring will be as well.
- Build Engagement –Employees become more invested in the company’s future.
- Spread Awareness of Your Brand – Employees are your greatest cheerleaders, sharing your company’s story in your community and bringing in potential new hires who will value a positive company culture.